Raj Venkaraman is a specialty retailer and is deciding where to locate his new auto manufacturing plant.

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Raj Venkaraman is a specialty retailer and is deciding where to locate his new auto manufacturing plant. The annual fixed and variable costs for each possible site have been estimated as follows:

Location Fixed Costs Variable Costs A $850,000 $4,000/car B $750,000 $4,500/car C $800,000 $7,200/car D $925,000 $6,600/car If demand is expected to be 175,000 units, which location is best?

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