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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.
a Compute the annual total cost for each plant, based on an expected annual volume of units.
tableLocationTotal costPlant APlant BPlant C
b At what annual volume would this company be indifferent between Plant A and Plant
Annual volume
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