One of the Objectives in Facility Location Analysis Is to Select

question 12

Multiple Choice

One of the objectives in facility location analysis is to select a site with the lowest total cost. Which of the following costs are hidden costs that should be included in the analysis?

• A) Infrastructure costs
• B) Movement of preproduction material between locations
• C) Taxes
• D) Construction costs
• E) Bribery costs

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Definitions:

Reciprocal Services Method

An accounting method used to allocate costs between departments of an organization that provide services to each other.

Support Department Costs

Expenses incurred by service departments that do not directly produce goods but support other departments that do.

Total Janitorial Costs

The complete expenses associated with cleaning and maintaining a facility.

Market Value

The current price at which an asset or service can be bought or sold in the open market, subject to supply and demand.