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A firm that has recently experienced an enormous growth rate is seeking to lease a small plant in Memphis. TN; Biloxi, MS; or Birmingham, AL.
A firm that has recently experienced an enormous growth rate is seeking to lease a small plant in Memphis. TN; Biloxi, MS; or Birmingham, AL. Prepare an economic anolysis of the three locations given the following information: Annual costs for buliding. equipment, and administration would be $59,000 for Memphis, $69.000 for Bloxd, and $104.000 for Birmingham. Labor and moterials are expected to be $7 per unit in Memphis. $5 per unit in Biloxi, and $5 per unit in Birmingham. The Memphis location would increase system transportation costs by $58,000 per year, the Biloxi location by $68,500 per year, and the Birmingham location by $25,400 per year. Expected annual volume is 14,400 units. A retired auto mechanic hopes to open a customizing shop for installing heated or ventilated seats. Two kocations are being considered, one in the center of the cly and one on the outskins. The central city location would involve fixed monthly costs of $6,850 and labor, materials, and transportation costs of $28 per car. The outside location wouid hove fixed monthly costs of $4,250 and labor. materials, and transportotion costs of $35 per car, Dealer price at either location will be $94 per car a. Which location win yield the greatest profit if monthly demand is (1) 290 cars? (2) 390 cors? b. At what voiume of oufpuit will the two stes yleid the some montry proft? (Round value to the nearest whole numbers) click here for the Excel Data File a. Using the above foctor fatings, calculate the composite score for each location. (Do not round intermediate calculations. Round your final answers to 2 decimal places.) b. Determine which location aiternative (A, B, or C) should be chosen on the basis of maximum composite score. A B C
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