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One company is evaluating two candidate locations in China for a new facility, which is scheduled to produce 5,000 units per year, with the following information.
a. Assume both the initial investment and government incentives are just one time.
b. Consider for a two-year period, which location should be chosen?
Xi'an Shenyang Variable Cost $100 $95 Annual Overhead $210,000 $190,000 Initial Investment $17,500,000 $16,800,000 Government Incentives $2,500,000 $1,000,000
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