Estimate giant marginal cost in the us

Assignment Help Microeconomics
Reference no: EM132908507

To take advantage of the "international bike shortage", Giant, the world largest bike manufacturer from Taiwan, resumed producing bikes for the US market in China. Presently, the US tariffs on the bikes produced in China make them more costly to deliver to American consumers compared to the bikes produced in Taiwan.

Suppose that prior to the pandemic, the average cost of a Giant bike sold in the US was $100 and all bikes were produced in Taiwan. Presently, the cost of those bikes did not change, but because of the added production in China, the average cost of a bike sold by Giant in the US is $106 and 30% of the bikes presently sold by Giant in the US are manufactured in China. To keep things simple, assume that the bike making technology in China exhibits constant returns to scale, so that every bike is equally costly to produce. What is the best way to estimate Giant's marginal cost in the US?

Reference no: EM132908507

Questions Cloud

What is the price elasticity of demand for laptop : When the price of laptop increased from $250 to $ $280 per unit, its quantity demanded decreases from 60 to 45. What is the price elasticity of demand for lapto
Integrating a palliative approach : Considering members of the interdisciplinary healthcare team who are responsible for care of a person dying in a long term care facility
Maximize the expected value of the potential sale : Your company has a customer who is shutting down a production line, and it is your responsibility to dispose of the extrusion machine. The company could keep it
Prepare the journal entries related to the investment : When the book value of Snoopy's net assets was equal to $308,000. Prepare the journal entries related to the investment
Estimate giant marginal cost in the us : To take advantage of the "international bike shortage", Giant, the world largest bike manufacturer from Taiwan, resumed producing bikes
Make demand for iphones price-inelastic : It appears that iPhone users tend to be very loyal to Apple technology overall and are unlikely to switch to the products of competitors.
Explain the three-sector model : Explain the three-sector model (goods market, bond market and money market) in relation to phase three of the business cycle.
Prepare four line graphs with the ratio on the vertical axis : Prepare four line graphs with the ratio on the vertical axis and the years on the horizontal axis for the following four ratios
Discuss the importance of the balance of payments : Discuss the importance of the balance of payments as an accounting measure.

Reviews

Write a Review

Microeconomics Questions & Answers

  Bullthe table and graph shown below illustrate the demand

bullthe table and graph shown below illustrate the demand and supply schedules for television sets in venezuela a small

  How much of the remaining difference could be explained

From 1982 through 2000, the S&P 500 stock price index rose an average of 14.7% per year (all figures in this problem are annual averages).

  Phases of production-law of diminishing returns

Assume each worker is paid $10 per hour and works a 40-hours week. How many workers should the firm hire if the price of the output is $ 10? Suppose the price of the output falls to $7.50.What do you think would be the short-run impact on the firm..

  Give a critical evaluation of the way

Give a critical evaluation of the way in which this concept has been affected by the theories of Maynard Keynes, Karl Marx, Milton Friedman and political expediency and /or dogma.

  Demand of wealthy individuals for leaving an inheritance

The chapter began by discussing another tax that targets wealthy individuals: the estate tax. Comment on the effectiveness of this tax.

  Draw a correctly labeled graph of the soybean market

The fertilizers used in soybean production generate a negative externality by seeping liquid contaminants into local rivers.

  Which of the following bonds has a higher current yield

Which of the following bonds has a higher current yield - i) a 6% coupon bond whose market price and face value are equal to $1000 or a ii) 7.5% coupon bond with $1000 face value and market price of $1250?

  Verify that the test statistic is equal

For the Japanese female face, y¯ = 10.2% and s = 31.3%. The researchers used this sample information to test the null hypothesis of a mean level of feminization equal to 0%. Verify that the test statistic is equal to 2.3.

  Explain disadvantages of a joint-venture

When a firm focuses on increasing profitability by customizing the firm's good or services so that they provide a good match to tastes in different national markets, it is pursuing A Localization strategy.

  Identify the issue that your executive has inquired about

In this section of your presentation, you will identify the issue that your executive has inquired about. A. Describe the context of the issue that was presented to you and the specific statements that you will research.

  What is the size of the labor force in madison

Suppose there are 15,000 people living in Madison in 2008. Out of these 15,000 people, 4,000 are either too old to work or too young to work. What is the size of the labor force in Madison in 2008

  How does that change a bidder optimal strategy

Is it possible that a bidder might receive useful information during the auction, particularly from the dollar amounts other bidders are bidding? If so, how does that change a bidder's optimal strategy?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd