Neco Model Questions Vol1 2017 Geography Question 14

A manufacturing firm needs to locate a new plant. It will process 5 000 t of raw material per year and ship the same amount to market. Transport cost is ₦0.05 per ton‑km. The three possible sites have the following data:\n\nSite A: distance to raw material 80 km, distance to market 120 km, labour cost per worker ₦200 000 per year, 150 workers required, fixed capital cost ₦5 000 000, no agglomeration discount.\nSite B: distance to raw material 50 km, distance to market 150 km, labour cost per worker ₦180 000 per year, 130 workers required, fixed capital cost ₦4 500 000, 10 % agglomeration discount on total cost.\nSite C: distance to raw material 100 km, distance to market 80 km, labour cost per worker ₦210 000 per year, 160 workers required, fixed capital cost ₦5 200 000, no agglomeration discount.\nCalculate the total annual cost for each site (including transport, labour and capital, applying any discount) and identify the most economical location.