Additional problem $08-02($Algo$)$

A firm that has recently experienced enormous growth is seeking to expand its capacity by leasing a small plant, and is considering three cities.

The table below shows fixed cost per year, variable cost per unit, and additional system transportation cost per year for each location.

Location Fixed Cost per Year Variable Cost per Unit Transportation Cost per Year

Plant A $ $70,000$ $ $8$ $ $206,000$

Plant B $ $86,000$ $ $6$ $ $286,000$

Plant C $ $82,000$ $ $9$ $ $194,000$

a$.$ Compute the annual total cost for each plant, based on an expected annual volume of $80,000$ units.

b$.$ At what annual volume would this company be indifferent between Plant A and Plant B$?$