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COST DALLAS DETROIT Fixed costs $600,000 $800,000 Variable costs $28/radio $22/radio

COST DALLAS DETROIT Fixed costs $600,000 $800,000 Variable costs $28/radio $22/radio

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Peter Billington Stereo, Inc., supplies car radios to auto manufacturers a nd is going to open a new plant. The company is undecided between Detroit and Dallas as the site. The fixed costs in Dallas are lower due to cheaper land costs, but the variable costs in Dallas are higher because shipping distances would increase. Given the following costs:                                                   a) Perform an analysis of the volume over which each location is preferable.
b) How does your answer change if Dallas's fixed costs increase by 10%?
COST DALLAS DETROIT Fixed costs $600,000 $800,000 Variable costs $28/radio $22/radio
Transcribed Image Text:COST DALLAS DETROIT Fixed costs $600,000 $800,000 Variable costs $28/radio $22/radio
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