Q. A manager must decide between 2 location alternatives, Boston also Chicago. Boston would have annual fixed costs of $70,000, transportation costs of $6 per unit also labour also material costs of $20 per unit. Chicago would have annual fixed costs of $90,000, transportation costs of $4 per unit also labour also material costs of $17 per unit. Revenue will be $300 per unit.

a. describe how much demand is needed to break even at every location?

b. Which alternative would yield the higher profit for an annual demand of 3,000 units?

c. At Elucidate what volume of demand would the manager be indifferent between the 2 cities? Which city should be chosen if demand is higher than this volume?