An operations manager has narrowed down the search for a new King Kola plant to three locations. Fixed and variable costs follow.
Location Fixed Cost Variable Cost
A $100,000 $10
B $150,000 $7
C $200,000 $5
Plot the total cost curves in the chart provided and identify the range over which each location would be best. Then use break-even analysis to calculate exactly the break-even quantity that defines each range.