a. If this facility will produce 5,000 units annually, where should West Calder locate it? b. What is the point of indifference between Singapore and Hong Kong?

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Chapter15: Decision Analysis
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3. West Calder Fabrication is trying to decide in which of the following three cities to locate a new
production facility, and has gathered the following information about each: (Noteshaper
Scenario #28)
City
Singapore
Hong Kong
Niagara Falls
Annual Fixed Costs
$40,000
$30,000
$10,000
Variable Costs (per unit)
$1
$3
$5
If this facility will produce 5,000 units annually, where should West Calder locate it?
a.
b. What is the point of indifference between Singapore and Hong Kong?
Transcribed Image Text:3. West Calder Fabrication is trying to decide in which of the following three cities to locate a new production facility, and has gathered the following information about each: (Noteshaper Scenario #28) City Singapore Hong Kong Niagara Falls Annual Fixed Costs $40,000 $30,000 $10,000 Variable Costs (per unit) $1 $3 $5 If this facility will produce 5,000 units annually, where should West Calder locate it? a. b. What is the point of indifference between Singapore and Hong Kong?
Over what range of production levels would West Calder Fabrication prefer to be in Niagara
Falls? (Use 0, 10000, 20000, 30000, 40000 as your volume levels to set up your graph)
C.
Transcribed Image Text:Over what range of production levels would West Calder Fabrication prefer to be in Niagara Falls? (Use 0, 10000, 20000, 30000, 40000 as your volume levels to set up your graph) C.
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