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FOB Mill Pricing and Plant Location when Demand is Linear but Non-uniform

Department af Economics, San Jose State University, San Jose, CA 95192, USA and at the University of Alaska, Fairbanks, Alaska

This paper examines the impact of non-uniform linear demand on plant location under FOB mill pricing. It shows that the principle of median location and the Rydell principle fail to apply, and some well-established results in plant location theory no longer hold when demand is linear but non-uniform.

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