Question #$1(20$ Marks$)$

A company is considering four locations in Oman to open its new factory that produces drilling equipment. As an operation engineer, you are asked to decide on the best location for an investment using the data given in Table Q$1.$ By estimating the fixed and variable costs and keeping the average sale price of the equipment similar, discuss the following.

Table Q$1$

$\backslash$table$[[$Location$,$Fixed Cost $($OMR$),\backslash$table$[[$Variable Cost$],[($OMR$)]],\backslash$table$[[$Average sales$],[$price of the$],[$equipment $($OMR$)]]],[$Salalah$,$K$,$W$,$A$],[$Buraimi$,$L$,$X$,$A$],[$Nizwa$,$M$,$Y$,$A$],[$Muscat$,$N$,$Z$,$A$]]$

a$)$ Determine the total costs for different volumes of production at the four locations.

$[2$ marks$]$

b$)$ Discuss the suitable location based on the total costs from part $($a$).$

$[3$ marks$]$

c$)$ Determine profits for the low, medium and higher volumes of production.

$[3$ marks$]$

d$)$ Determine sales volume when choosing between Buraimi and Nizwa.

$[3$ marks$]$

e$)$ For part $($d$),$ draw the chart showing the volume of selection.

$[3$ marks$]$

f$)$ Propose the best location for the sales volume of more than $3000$ units.

$[3$ marks$]$

g$)$ Write a summary on the decision you would make.

$[3$ marks$]$