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Author Question: An operations manager has narrowed down the search for a new plant to three locations. Fixed and ... (Read 69 times)

rmenurse

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

Plot the total cost curves in the chart provided and 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 quite low.
◦ The break-even quantity between C and B is more than 3000 units.
◦ Location A becomes the most expensive place to produce at volumes in excess of 2000.
◦ The break-even quantity between A and B is less than or equal to 500 units.


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Marked as best answer by rmenurse on Apr 18, 2020

Pamela.irrgang@yahoo.com

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rmenurse

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Reply 2 on: Apr 18, 2020
Great answer, keep it coming :)


ryansturges

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Reply 3 on: Yesterday
Excellent

 

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