Breakeven calculation
Question Description
- Assume that Percy has selected Finland as the best location to begin his international expansion. Now, Percy begins to put costs together. He forecasted 7,000 fireplaces per year. Calculate the breakeven points for the three countries. Should Percy still go with Finland or should he select another country? If the forecast was 5,000 should Percy ignore the weighted factor model? Explain why or why not.
LOCATION ANNUAL FIXED COST ($) UNIT VARIABLE COST ($) Finland $550,000.00 $180.00 Germany $450,000.00 $200.00 United Kingdom $400,000.00 $220.00
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