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A manufacturing firm is considering two locations for a plant to produce a new product. The two locations have fixed and variable costs as follows:
A manufacturing firm is considering two locations for a plant to produce a new product. The two locations have fixed and variable costs as follows:
Location | Fixed cost | variable cost |
Atlanta | $83,000 | $27/unit |
Phoenix | $132,000 | $18/unit |
Which alternative will have lower cost when they plan to produce 50,000 units of product per year
Atlanta
Both of them have almost same cost
Phoenix
Can not be decided
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