QUESTION $2[15$ Marks$]$

Study the caselet provided below and answer the following questions.

Th e man ag e men t of DGB Enterprises h as n arrow e d dow n th e site selection f or a n ew man uf actu rin g f acility to th ree

poten tial locations $$ A$,$ B an d C$.$ Th e inf ormation provided below sh ows th e annu al fixed costs an d variable costs per unit

of the product at each of three location s$.$

INFORMATION

Location Fixed costs Variable costs per unit

A R$3000000$ R$50$

B R$4500000$ R$25$

C R$6000000$ R$15$

After an extensive market su rvey, th e operations an alyst of DGB Enterprises h as estimated a R $75$ target sellin g price for

each unit of the produ ct expected to be produ ced at the facility.