A firm is considering three different locations in which to build a factory. The costs associated with each location are given below. Location A B C Fixed Costs 500 700 900 Variable costs per unit 10 6 4 Plot the crossover chart for the locations. What level of output will each location be preferred? Write an equation to represent the costs for each location.
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A firm is considering three different locations in which to build a factory. The costs associated with each location are given below.
Location | A | B | C |
Fixed Costs | 500 | 700 | 900 |
Variable costs per unit | 10 | 6 | 4 |
- Plot the crossover chart for the locations.
- What level of output will each location be preferred?
- Write an equation to represent the costs for each location.
- Use algebra to determine the crossover points.
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