DryIce, Inc. is a manufacturer of air conditioners that has seen its demand grow significantly. The company anticipates nationwide demand for the year 2010 to be 180,000 units in the South; 120,000 units in the Midwest; 110,000 units in the East; and 100,000 units in the West. Managers at DryIce are designing the manufacturing network and have selected four potential sites – New York, Atlanta, Chicago, and San Diego. Plants could have a capacity of either 200,000 or 400,000 units. The annual fixed costs at the four locations are shown in the table below, along with the cost of producing and shipping an air conditioner to each of the four markets. Where should DryIce build its factories and how large should they be? New York Atlanta Chicago San Diego Annual fixed cost of 200,00 plant $6 miilion 5.5 million 5.6 million 6.1 million Annual fixed cost of 400,000 $10 million $9.2 million 9.3 million 10.2 million EAST $211 $232 $238 $299 SOUTH $232 $212 $230 $280 MIDWEST $240 $230 $215 $270 WEST $300 $280 $270 $225
DryIce, Inc. is a manufacturer of air conditioners that has seen its demand grow significantly. The company anticipates nationwide demand for the year 2010 to be 180,000 units in the South; 120,000 units in the Midwest; 110,000 units in the East; and 100,000 units in the West. Managers at DryIce are designing the manufacturing network and have selected four potential sites – New York, Atlanta, Chicago, and San Diego. Plants could have a capacity of either 200,000 or 400,000 units. The annual fixed costs at the four locations are shown in the table below, along with the cost of producing and shipping an air conditioner to each of the four markets. Where should DryIce build its factories and how large should they be? New York Atlanta Chicago San Diego Annual fixed cost of 200,00 plant $6 miilion 5.5 million 5.6 million 6.1 million Annual fixed cost of 400,000 $10 million $9.2 million 9.3 million 10.2 million EAST $211 $232 $238 $299 SOUTH $232 $212 $230 $280 MIDWEST $240 $230 $215 $270 WEST $300 $280 $270 $225
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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DryIce, Inc. is a manufacturer of air conditioners that has seen its demand grow significantly. The company anticipates nationwide demand for the year 2010 to be 180,000 units in the South; 120,000 units in the Midwest; 110,000 units in the East; and 100,000 units in the West. Managers at DryIce are designing the manufacturing network and have selected four potential sites – New York, Atlanta, Chicago, and San Diego. Plants could have a capacity of either 200,000 or 400,000 units. The annual fixed costs at the four locations are shown in the table below, along with the cost of producing and shipping an air conditioner to each of the four markets. Where should DryIce build its factories and how large should they be?
| New York | Atlanta | Chicago | San Diego | ||||
| Annual fixed cost of 200,00 plant | $6 miilion | 5.5 million | 5.6 million | 6.1 million | |||
| Annual fixed cost of 400,000 | $10 million | $9.2 million | 9.3 million | 10.2 million | |||
|
EAST |
$211 | $232 | $238 | $299 | |||
| SOUTH | $232 | $212 | $230 | $280 | |||
| MIDWEST | $240 | $230 | $215 | $270 | |||
| WEST | $300 | $280 | $270 | $225 | |||
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