A manufacturing company preparing to build a new plant is considering three potential locations for it.

1. A manufacturing company preparing to build a new plant is considering three potential locations for it. The fixed and variable costs for the three alternative locations are presented below:

a. Draw the total cost lines for the three options
b. Indicate over what range each of the alternatives A,B,C is the low-cost choice
c. For the production of 250 units, which site is the best?

Cost A B C
Fixed ($) 400 1,000 2,000
Variable ( $ per unit) 12 8 4

2. Use exponential smoothing with a=0.2 to calculate the forecast for July from the data below.

Period Demand
January 10
February 8
March 7
April 10
May 12
June 9

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