Question

Which of the following factors are used to determine where a facility should be located?

a) Environmental and cultural impact
b) Proximity to the incident or event
c) Proximity to hospitals
d) Both A and B

Answer 1

Businesses prioritize various factors such as labor and capital costs, proximity to suppliers and customers, infrastructure quality, tax levels, and local government efficiency over environmental costs when determining a facility's location.

Step-by-step explanation:

When determining where to locate a facility, businesses consider a variety of factors that influence their decision-making process. These include the costs of labor and capital, proximity to suppliers and customers, and the quality of local infrastructure such as transportation, communications, and electrical power networks. Additionally, they assess the local taxation level, environmental regulation costs, and the competence and integrity of the local government.

Although environmental costs are a factor, they generally account for only 1 to 2% of the total costs that a large industrial plant may face. Thus, while environmental and cultural impacts may be considered, they are typically less critical than operational and financial considerations. Instead, the proximity to suppliers, customers, and quality infrastructure, alongside local government competence and honesty, play more significant roles in location decisions, outweighing concerns about environmental protection costs.