QUESTION #$6-(15$ points$)-$ Use the Break$-$Even Model to determine where Wal$-$Mart should build its first milk processing facility in Florida.

Wal$-$Mart has done its research and determined annual fixed and variable costs associated to their first milk processing facility in Florida, if installed in Ocala or Sebring, as described on the table below in US$:

$\backslash$table$[[$Location$,$Annual Fixed Costs $($in $$1,000),$Unit Variable Cost $($$ per gallon of milk$)],[$Ocala$,2,500,000,0\mathrm{.}60],[$Sebring$,1,500,000,0\mathrm{.}80]]$

If the demand for the first year is $50,000$ gallons of milk and the second year is increased to $60,000$ gallons of milk, calculate the total cost of operation for each location in the first year and in the second year. If Walmart asks you to consider the sum of the total cost for the first and second year to decide where to build its facility, what would be your recommendation?

If you do not show your catculations, you WILL NOT GET ANY CREDIT FOR JUST PRESENTING THE FINAL RESULTS.

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