WorksheetsLocation Decisions
Total questions: 15
Worksheet time: 23mins
Industrial location analysis typically attempts to:
minimize costs.
maximize sales.
focus more on human resources.
avoid countries with strict environmental regulations.
Which of the following workers is the most productive?
$50 wages, 10 parts produced
$10 wages, 1 part produced
$30 wages, 5 parts produced
$100 wages, 21 parts produced
The reason fast food restaurants often are found in close proximity to each other is:
location clustering near high traffic flows.
low cost.
availability of skilled labor.
all of the above
Tangible costs include which of the following?
climatic conditions
availability of public transportation
taxes
quality and attitude of prospective employees
Which of the following statements regarding "proximity" in the location decision is FALSE?
Manufacturers want to be near customers when their product is bulky, heavy, or fragile.
Perishability of raw materials is a good reason for manufacturers to locate near the supplier, not the customer.
Reduction in bulk is a good reason for a manufacturer to locate near the supplier.
Clustering among fast food chains occurs because they need to be near their labor supply.
Community attitudes, zoning restrictions, and quality of labor force are likely to be considered in which of the following location decision methods?
transportation method
locational cost-volume analysis
center-of-gravity method
factor-rating method
On the crossover chart where the costs of two or more location alternatives have been plotted, the quantity at which two cost curves cross is the quantity at which:
fixed costs are equal for two alternative locations.
total costs are equal for all alternative locations
total costs are equal for two alternative locations.
fixed costs equal variable costs for one location.
A firm is considering two location alternatives. At location A, fixed costs would be $4,000,000 per year, and variable costs $0.30 per unit. At alternative B, fixed costs would be $3,600,000 per year, with variable costs of $0.35 per unit. If annual demand is expected to be 10 million units, which plant offers the lowest total cost?
Plant A, because it is cheaper than Plant B for all volumes over 8,000,000 units.
Plant B, because it is cheaper than Plant A for all volumes over 8,000,000 units.
Plant A, because it is cheaper than Plant B for all volumes.
Plant B, because it has the lower variable cost per unit.
The center-of-gravity method is used primarily to determine what type of locations?
service locations
manufacturing locations
distribution center locations
supplier locations
East Texas Seasonings is preparing to build one processing center to serve its four sources of seasonings. The four source locations are at coordinates shown below. Also, the volume from each source is provided. What is the center of gravity?
X = 28.125; Y = 31.25
X = 22000; Y = 24000
X = 27.5; Y = 40
center of gravity = 28
Which of the following statements regarding the center-of-gravity method is FALSE?
It is designed to minimize the maximum possible travel distance to any of the locations.
The optimal x- and y-coordinates are calculated separately.
The optimal solution is unconstrained, so it could suggest a location in the middle of a body of water.
The weights used are the quantity of goods moved to or from each location.
Which of the following methods best considers intangible costs related to a location decision?
crossover methods
locational cost-volume analysis
factor-rating method
the transportation method
Production and transportation costs are always considered in which of the following location decision methods?
traffic counts
transportation model
purchasing power
proximity of markets
A location decision for a service sector would tend to have what type of focus?
cost focus
labor focus
revenue focus
environmental focus
A jewelry store is more likely than a jewelry manufacturer to consider ________ in making a location decision.
transportation costs
cost of raw materials
appearance/image of the location
quality of life
