A Netty formed firm must decide on a plant location There are two alternatives u

Question

A Netty formed firm must decide on a plant location There are two alternatives under consideration locate near the major raw catenates or locate near the major customers Locating near the raw materials will result in lower fixed and van able costs than locating near the market but the owners bereave there would be a loss in sales volume because customers tend to favor local suppers Revenue per unt will be $182 in either case Using the above information determine which location would produce the greater profit (Omit the "$" sign in your response.)

Explanation / Answer

Profit Omaha=9825*(182-30)-1100000=393400

Profit Kansa=10075*(182-45)-1200000=180275

therefore Omaha will produce greater profit by(393400-180275)=213125

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