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  • Ejercicio Wiebe Trucking Ciudad Ofrece Costos Mas Bajos en General

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    Xiimena Rojas
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    Wiebe Trucking is considering three locations - Denver, Santa Fe, and Salt Lake City - for a new warehouse. The document provides annual fixed costs and average variable costs per shipment for each location. It also lists an estimated sales projection range of 550,000 to 600,000 shipments per year. Total cost curves were plotted for each location on a graph using the fixed and variable cost data. Salt Lake City was found to have the lowest overall costs for up to 576,923 shipments, after which Denver would be the lowest cost location.

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    Wiebe Trucking is considering three locations - Denver, Santa Fe, and Salt Lake City - for a new warehouse. The document provides annual fixed costs and average variable costs per shipment for each location. It also lists an estimated sales projection range of 550,000 to 600,000 shipments per year. Total cost curves were plotted for each location on a graph using the fixed and variable cost data. Salt Lake City was found to have the lowest overall costs for up to 576,923 shipments, after which Denver would be the lowest cost location.

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as doc, pdf, or txt
    349 views1 page

    Ejercicio Wiebe Trucking Ciudad Ofrece Costos Mas Bajos en General

    Uploaded by

    Xiimena Rojas
    Wiebe Trucking is considering three locations - Denver, Santa Fe, and Salt Lake City - for a new warehouse. The document provides annual fixed costs and average variable costs per shipment for each location. It also lists an estimated sales projection range of 550,000 to 600,000 shipments per year. Total cost curves were plotted for each location on a graph using the fixed and variable cost data. Salt Lake City was found to have the lowest overall costs for up to 576,923 shipments, after which Denver would be the lowest cost location.

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as doc, pdf, or txt
    of 1

    Wiebe Trucking. Inc. is planning a new warehouse to serve the west.

    Denver, Santa Fe, and Salt


    Lake City are under consideration. For each location, annual fixed costs (rent, equipment. and
    Insurance) and average variable costs per shipment (labor, transportation and utilities) are listed in
    the following table. Sales projection is range from 550,000 to 600,000 shipments per year.

    .:.
    a. Plot the total cost curves for all the locations on a single graph.
    b. Which city provides the lowest overall costs?
    SOLUTION:
    a.

    Plot of total costs (in $ millions) versus volume (in thousands)


    9

    5,000,000 + 4.65 Q
    Denver

    3,500,000 + 7.25 Q
    Salt Lake City

    4,200,000 + 6.25 Q
    4
    Santa Fe
    3
    0

    200

    400
    Volume

    600

    800

    576.9

    b. For up to 576,923 shipments per year, Salt Lake City is the best location. Beyond that,
    Denver is the best location.

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