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A firm that has recently experienced enormous growth is seeking to expand its capacity by leasing a small plant, and is considering three cities. The
A firm that has recently experienced enormous growth is seeking to expand its capacity by leasing a small plant, and is considering three cities. The table below shows fixed cost per year, variable cost per unit, and additional system transportation cost per year for each location. Location Fixed Cost per Year Variable Cost per Unit Transportation Cost per Year Plant A $ 82,000 $ 4 $ 194,000 Plant B $ 110,000 $ 3 $ 298,000 Plant C $ 94,000 $ 5 $ 182,000 a. Compute the annual total cost for each plant, based on an expected annual volume of 80,000 units. b. At what annual volume would this company be indif
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