The range of output for each alternative that would yield lowest total cost. Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

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Answer 1

Question

Chapter 8, Problem 4P

a)

Summary Introduction

To determine: The range of output for each alternative that would yield lowest total cost.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

b)

Summary Introduction

To determine: The alternative that would yield lowest total cost for an expected annual volume of 150 boats.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

c)

Summary Introduction

To determine: The other factors that might be considered for choosing between expansions and subcontracting.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

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A company that produces pleasure boats has decided to expand one of its lines. Current facilities are insufficient to handle the increased workload, so the company is considering three alternatives. A (new location), B (subcontract), and C (expand existing facilities). Alternative A would involve substantial fixed costs but relatively low variable costs: fixed costs would be $315,000 per year, and variable costs would be $600 per boat. Subcontracting would involve a cost per boat of $2,580, and expansion would require an annual fixed cost of $58,000 and a variable cost of $1,040 per boat. a. Find the range of output for each alternative that would yield the lowest total cost. (Leave no cells blank be certain to enter "0" wherever required. Round your answers to the nearest whole number.) A B C or to OA OB OC to more b. Which alternative would yield the lowest total cost for an expected annual volume of 90 boats? c. What other factors might be considered in choosing between expansion…

A company that produces pleasure boats has decided to expand one of its lines. Current facilities are insufficient to handle the increased workload, so the company is considering two alternatives, A (new location), B (expand existing facilities). Alternative A would involve fixed costs of $250,000 per year, and variable costs would be $500 per boat. Alternative B would require an annual fixed cost of $50,000 and a variable cost of $1,000 per boat. a. At what volume of output would the two locations have the same total cost? b. Which alternative would yield the lowest total cost for an expected annual volume of 150 boats? Formulas: Total Cost= FC + VQ Total Profit= Q (R-V) - FC

A company that produces pleasure boats has decided to expand one of its lines. Current facilities are insufficient to handle the increased workload, so the company is considering three alternatives, A (new location), B (subcontract), and C (expand existing facilities).Alternative A would involve substantial fixed costs but relatively low variable costs: fixed costs would be $260,000 per year, and variable costs would be $610 per boat. Subcontracting would involve a cost per boat of $2,570, and expansion would require an annual fixed cost of $61,000 and a variable cost of $1,090 per boat.

Answer 2

Question

Chapter 8, Problem 4P

a)

Summary Introduction

To determine: The range of output for each alternative that would yield lowest total cost.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

b)

Summary Introduction

To determine: The alternative that would yield lowest total cost for an expected annual volume of 150 boats.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

c)

Summary Introduction

To determine: The other factors that might be considered for choosing between expansions and subcontracting.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

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Answer 3

Question

Chapter 8, Problem 4P

a)

Summary Introduction

To determine: The range of output for each alternative that would yield lowest total cost.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

b)

Summary Introduction

To determine: The alternative that would yield lowest total cost for an expected annual volume of 150 boats.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

c)

Summary Introduction

To determine: The other factors that might be considered for choosing between expansions and subcontracting.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

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Answer 4

Question

Chapter 8, Problem 4P

a)

Summary Introduction

To determine: The range of output for each alternative that would yield lowest total cost.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

b)

Summary Introduction

To determine: The alternative that would yield lowest total cost for an expected annual volume of 150 boats.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

c)

Summary Introduction

To determine: The other factors that might be considered for choosing between expansions and subcontracting.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

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Answer 5

Chapter 8, Problem 4P

a)

Summary Introduction

To determine: The range of output for each alternative that would yield lowest total cost.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

b)

Summary Introduction

To determine: The alternative that would yield lowest total cost for an expected annual volume of 150 boats.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

c)

Summary Introduction

To determine: The other factors that might be considered for choosing between expansions and subcontracting.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

Answer 6

Chapter 8, Problem 4P

a)

Summary Introduction

To determine: The range of output for each alternative that would yield lowest total cost.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

Answer 7

Chapter 8, Problem 4P

a)

Summary Introduction

To determine: The range of output for each alternative that would yield lowest total cost.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

Answer 8

b)

Summary Introduction

To determine: The alternative that would yield lowest total cost for an expected annual volume of 150 boats.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

Answer 9

b)

Summary Introduction

To determine: The alternative that would yield lowest total cost for an expected annual volume of 150 boats.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

Answer 10

c)

Summary Introduction

To determine: The other factors that might be considered for choosing between expansions and subcontracting.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

Answer 11

c)

Summary Introduction

To determine: The other factors that might be considered for choosing between expansions and subcontracting.

Introduction: Location is where a firm chooses to site its operations. Location decisions can have large effects on expenditure and incomes. Location choices are normally quite imperative to both private and substantial companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 8.6 - Prob. 1RQ Ch. 8.6 - Prob. 2RQ Ch. 8 - Prob. 1DRQ Ch. 8 - Prob. 2DRQ Ch. 8 - Prob. 3DRQ Ch. 8 - Prob. 4DRQ Ch. 8 - Prob. 5DRQ Ch. 8 - Prob. 6DRQ Ch. 8 - Prob. 7DRQ Ch. 8 - Prob. 8DRQ

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Chapter 8 Solutions