XYZ Company is considering expanding its new plant. Its favorable sites for expansion are Greenwood, Indianola, and Greenville. The company must select one of these sites given the following information (1) The company is expecting to sell 3000 units per year. (2) Fixed costs per year at Greenwood, Indianola and Greenville are $50,000, $80,000, and $120,000; and variable costs are $60, $100, and $80 per unit respectively. (3) The expected selling price for each unit $150. Based on the expected profit of each location, which site will be selected for plant expansion?

XYZ Company is considering expanding its new plant. Its favorable sites for expansion are Greenwood, Indianola, and Greenville. The company must select one of these sites given the following information (1) The company is expecting to sell 3000 units per year. (2) Fixed costs per year at Greenwood, Indianola and Greenville are $50,000, $80,000, and $120,000; and variable costs are $60, $100, and $80 per unit respectively. (3) The expected selling price for each unit $150. Based on the expected profit of each location, which site will be selected for plant expansion?

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter6: Optimization Models With Integer Variables

Section: Chapter Questions

Problem 100P

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