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  • QUESTION 3: Calculate Total Variable Cost From The Choice of Each Site For The New Texago Refinery The Texago Corp - Site Selection Problem

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    Anh Tú
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    St. Louis has the lowest total variable cost of $2.92 million for a new Texago refinery compared to Los Angeles ($3.07 million) and Galveton ($3.12 million) based on calculations of annual crude oil shipping costs, finished product shipping costs, and operation costs provided for each potential site. Therefore, the best location for the new refinery is St. Louis.

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    St. Louis has the lowest total variable cost of $2.92 million for a new Texago refinery compared to Los Angeles ($3.07 million) and Galveton ($3.12 million) based on calculations of annual crude oil shipping costs, finished product shipping costs, and operation costs provided for each potential site. Therefore, the best location for the new refinery is St. Louis.

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    49 views2 pages

    QUESTION 3: Calculate Total Variable Cost From The Choice of Each Site For The New Texago Refinery The Texago Corp - Site Selection Problem

    Uploaded by

    Anh Tú
    St. Louis has the lowest total variable cost of $2.92 million for a new Texago refinery compared to Los Angeles ($3.07 million) and Galveton ($3.12 million) based on calculations of annual crude oil shipping costs, finished product shipping costs, and operation costs provided for each potential site. Therefore, the best location for the new refinery is St. Louis.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 2

    QUESTION 3: Calculate total variable cost from the choice of each site for the new Texago refinery

    THE TEXAGO CORP.SITE SELECTION PROBLEM


    Shipping cost for crude oil Shipping cost for finish product Annual Operation cost
    Los Angeles $ 880 $ 1,570 $ 620
    Galveton $ 920 $ 1,630 $ 570
    St.Louis $ 960 $ 1,430 $ 530

    Compare the 3 total costs in the Total column, we notice that St. Louis has the lowestcost with 2.920 million $.

    Therefore, the best option would be St. Louis with a total cost of 2.920 million $
    he new Texago refinery

    Total
    $ 3,070
    $ 3,120
    $ 2,920

    ost with 2.920 million $.

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