The fixed and variable cost for three potential manufacturing plant sites for a wooden chair 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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