Question
Saddle Tramps Touch Screens, supplies car touch screens to EV auto manufacturers and is going to open a new plant. The company is undecided between
Saddle Tramps Touch Screens, supplies car touch screens to EV auto manufacturers and is going to open a new plant. The company is undecided between Detroit, San Francisco, and Dallas. The fixed costs per year in Dallas at $600,000 are the lowest , but the variable costs in Dallas at $90 per screen are somewhat expensive, because of shipping costs. San Francisco has the highest fixed costs at $1,000,000 per year due to extremely high land costs, and the highest variable costs per unit at $200 due to very high labor costs. Detroit has fixed costs per year of $800,000 and its variable costs per unit are $80. STTS expects to sell 5,000 touch screens per year. Where should they set up shop?
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