Gce Model Questions Vol1 2017 Geography Question 19
Practice objective / multiple choice question 19 from the 2017 Gce Model Questions Vol1 Geography examination.
A textile firm is choosing between two sites for a new factory.\n\nSite A: fixed capital cost £2.5 million, variable production cost £45 t⁻¹, distance to main market 120 km.\nSite B: fixed capital cost £2.0 million, variable production cost £48 t⁻¹, distance to market 80 km.\n\nTransport cost is £0.12 per tonne per kilometre. The plant is expected to produce 30 000 tonnes per year and the capital cost is amortised over 20 years (ignore discounting). Determine which site gives the lower average total cost per tonne (including fixed, variable and transport costs). State the chosen site and the corresponding average cost per tonne (to two decimal places).
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About This Question
This is Gce Model Questions Vol1 2017 Geography Question 19. It is one of the objective questions from the 2017 Gce Model Questions Vol1 Geography examination.
Difficulty level: Hard .
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