Plot the total cost lines. b) In what annual volume range will each facility have a competitive advantage? each facility? c) Perform the intersection volume calculation for the locations.

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Andec is considering opening a new smelter in Cuenca; Quito, or Portoviejo, to produce rebar. The following fixed cost and variable cost data were collected.
a) Plot the total cost lines.
b) In what annual volume range will each facility have a competitive advantage? each facility?
c) Perform the intersection volume calculation for the locations.

 

 

                      Costs per Unit

Location

Fixed cost per year

Material

Variable labor

General Expenses

Cuenca

$73.000

$0,50

$0,40

$0,55

Portoviejo

$55.000

$0,45

$0,55

$0,60

Quito

$80.000

$0,38

$0,80

$0,90

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