Operation management
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The fixed and variable costs for three potential manufacturing plant sites for a rattan chair weaver are shown.
Site Fixed Cost per Year Variable Cost per Unit
1 $ 500 $ 11
2 $ 1,000 $ 7
3 $ 1,700 $ 4
A. Over what range of production is each location optimal?
B. For a production of 200 units, which site is best?
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Solution Summary
Solution shows optimal location for different range of production.
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