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Hyundai Motors is considering three sites A , B , and Cat which to locate a factory to build its new electric car batteries. The
Hyundai Motors is considering three sitesAB and Cat which to locate a factory to build its new electric car batteries. The goal is to locate at a minimumcost site, where cost is measured by the annual fixed plus variable costs of production. Hyundai Motors has gathered the following data:
Site
Annualized Fixed Cost
Variable Cost per Battery Produced
The firm knows it will produce between and batteries at the new plant each year, but, thus far, that is the extent of its knowledge about production plans.
Part
a The value of volume, V of production above which site is recommended
enter your response here batteries round your response up to the next whole number
Part
b The value of volume, V of production below which site is recommended
enter your response here batteries round your response up to the next whole number
Part
c Over what range of volume is site optimal
A
Site is never optimal because its cost line always exceeds that of A or C for all volume levels.
B
Site is optimal for volumes from to batteries.
C
Site is optimal for volumes above batteries.
D
Site is always optimal because its cost line is always below that of A and C for all volume levels.
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