Top Posters
Since Sunday
c
6
r
4
c
3
m
3
h
3
1
3
n
3
s
3
d
3
c
3
r
3
e
3
Home Q & A Board Other Fields Homework Help Business Management
New Topic  
sinnefoula sinnefoula
wrote...
Go to Answer
Posts: 1533
Rep: 1 0
7 years ago
A firm is considering two location alternatives. At location A, fixed costs would be $4,000,000 per year, and variable costs $0.30 per unit. At alternative B, fixed costs would be $3,600,000 per year, with variable costs of $0.35 per unit. If annual demand is expected to be 10 million units, which plant offers the lowest total cost?
A) Plant A, because it is cheaper than Plant B for all volumes.
B) Plant A, because it is cheaper than Plant B for all volumes over 8,000,000 units.
C) Plant B, because it is cheaper than Plant A for all volumes over 8,000,000 units.
D) Plant B, because it has the lower variable cost per unit.
E) Neither Plant A nor Plant B, because the crossover point is at 10 million units.
Textbook 
Operations Management

Operations Management


Edition: 10th
Authors:
Read 431 times
1 Reply
Replies
Answer verified by a subject expert
kadajikadaji
wrote...
#1
Top Poster
Posts: 992
Rep: 9 0
7 years ago
Sign in or Sign up in seconds to unlock everything for free
More solutions for this book are available here
1

Related Topics

sinnefoula Author
wrote...

7 years ago
You make an excellent tutor!
patod1
wrote...

Yesterday
This calls for a celebration Person Raising Both Hands in Celebration
kriggs62
wrote...

2 hours ago
Good timing, thanks!
New Topic      
Quick Reply
Explore
Post your homework questions and get free online help from our incredible volunteers
  1180 People Browsing
Start New Topic Take the Tour CoursesNew Study Tools Topics Trending Browse by Textbook
Live Chat
Related Images
  
 577
  
 262
  
 1040
Your Opinion
Which 'study break' activity do you find most distracting?
Votes: 824
Previous poll results: Do you believe in global warming?