Question: Please show all your steps that you take to resolve this. Please be very clear, so that I understand what steps you take. If typing,

Please show all your steps that you take to

Please show all your steps that you take to resolve this. Please be very clear, so that I understand what steps you take. If typing, please bold your responses per step.

Audi Motors is considering three sites-A, B, and C-at which to locate a factory to build its new-model automobile, the Audi SUV XL500. The goal is to locate at a minimum-cost site, where cost is measured by the annual fixed plus variable costs of production. Audi Motors has gathered the following data. Site Annualized Fixed Cost A B C $10,000,000 $24,000,000 $25,000,000 Variable Cost per Auto Produced $2,400 $1,900 $1,050 The firm knows it will produce between 0 and 60,000 SUV XL500s at the new plant each year, but, thus far, that is the extent of its knowledge about production plans. a) The value of volume, V, of production above which site C is recommended = SUV XL500s. (Round your response up to the next whole number.) b) The value of volume, V, of production below which site A is recommended = SUV XL500s. (Round your response up to the next whole number.) c) Over what range of volume is site B optimal? A. Site B is never optimal because its cost line always exceeds that of A or C for all volume levels. B. Site B is optimal for volumes from 11,112 to 28,000 SUV XL500s. C. Site B is optimal for volumes above 28,000 SUV XL500s. D. Site B is always optimal because its cost line is always below that of A and C for all volume levels

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!