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» Economics » Economist (20. Jh.) » Topics begins with D » David M. Smith

Page modified: Wednesday, July 13, 2011 11:47:39

David M. Smith [] extended Alfreds' of weber industrielle location theories by a variable cost model, which covers different basic costs apart from the transport costs also. Additionally it blends this space cost curve with a curve for the profit possibilities.


That means in detail that there is a value for the costs for each possible location (transport costs, labor costs etc.) from different locations in a diagram can one thereby a cost curve provide.

On the other side there is value for erwartbaren proceeds, which results from the size of the respective market for each place. Also one can register these values in a diagram and provide from this a proceeds curve.

One puts now these two curves one above the other can the place specify with that to 1. proceeds the costs to exceed (profit) and 2. the profit is maximum. This is the optimal location.

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