An operations manager has narrowed down the search for a new King Kola plant to three locations. Fixed and variable costs follow.

? Location

?Fixed Cost

?Variable Cost

?A

?$ $100,000$

?$ $10$

?B

?$ $150,000$

?$ $7$

?C

?$ $200,000$

?$ $5$

?

Identify the range over which each location would be best. Then use break $-$ even analysis to calculate exactly the break $-$ even quantity that defines each range.

Which of the following statements is correct?

?

Location C is the best one if volumes are less than $5000.$

?

Location A becomes the most expensive place to produce at volumes less than $10,000.$

?

The break $-$ even quantity between A and B is less than or equal to $17,000$ ?units.

?

The break $-$ even quantity between C and B is more than $30,000$ ?units.