Detailed Answer
Answer (A) is correct.
Fixed cost (FC) is $200,000, the amount at which the total cost (TC) line
crosses the y-axis (when no warehouses are in operation). The total
variable cost (VC) of operating 10 warehouses is $1,500,000 ($1,700,000
TC - $200,000 FC), so the variable cost per warehouse is $150,000
($1,500,000 ÷ 10). Y (TC) is therefore equal to $200,000 (FC) plus
$150,000X (VC).