Green Paper Recycling manufactures paper plates and cups from recycled paper and cardboard. The company has narrowed its potential choices for its new manufacturing facility to four cities in France. Management has gathered the following information about the manufacturing and shipping costs of locating in each of these four cities:

a. Use break-even analysis to determine where Green Paper should locate.
b. Based solely on the break-even quantity, if Green Paper’s manufacturing forecast for the foreseeable future is 500,000 units annually, where should it locate?

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Fixed Costs per Year €350,000 Marseille €675,000 €1,300,000 €1,800,000 City Paris Lyon Toulouse Variable Manufacturing Costs per 1,000 Units €10.00 €8.00 €4.00 €6.00 Variable Shipping Costs per Unit €5.00 €4.00 €3.00 €5.00