Please answer the rest.
- Question A Has Been Answered Price Is 133 Please Answer The Rest 1 (39.41 KiB) Viewed 19 times
Question a) has been answered. Price is 133. Please answer the rest.
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Question a) has been answered. Price is 133. Please answer the rest.
Question a) has been answered. Price is 133.
Please answer the rest.
Consider a Japanese firm that sells product Y in the local market and contemplates sales to the US. If the Japanese firm enters the American market it will compete in quantities against a US firm already in the market. The inverse demand for Y in the US is Pus = 250 - Q (all prices and costs in this problem are in $US), where Q = qu + q, is total quantity eventually sold by the two competitors. The production of Y requires operating a plant at a fixed cost F = 300, as well as 1 unit of labor and 1 unit of capital per unit of output. Currently, at both the US and Japan the cost of capital is $15/unit and that of labor $10/unit. The Japanese firm has the option to either invest directly in operating a plant in the US, or use at no extra fixed cost its already existing plant in Japan, shipping its product to the US. In that case a transportation cost of $10/unit has to be paid on top of any production cost; also, American customs require a $5/unit duty for any Y imports. a) Find the price of Y in the US b) The profits of the American and the Japanese firm and c) Total labor income in the Y sector in the US. d) Political pressure by unions in the US results in a new wage of $25/unit. Repeat the above calculations in the new situation
Please answer the rest.
Consider a Japanese firm that sells product Y in the local market and contemplates sales to the US. If the Japanese firm enters the American market it will compete in quantities against a US firm already in the market. The inverse demand for Y in the US is Pus = 250 - Q (all prices and costs in this problem are in $US), where Q = qu + q, is total quantity eventually sold by the two competitors. The production of Y requires operating a plant at a fixed cost F = 300, as well as 1 unit of labor and 1 unit of capital per unit of output. Currently, at both the US and Japan the cost of capital is $15/unit and that of labor $10/unit. The Japanese firm has the option to either invest directly in operating a plant in the US, or use at no extra fixed cost its already existing plant in Japan, shipping its product to the US. In that case a transportation cost of $10/unit has to be paid on top of any production cost; also, American customs require a $5/unit duty for any Y imports. a) Find the price of Y in the US b) The profits of the American and the Japanese firm and c) Total labor income in the Y sector in the US. d) Political pressure by unions in the US results in a new wage of $25/unit. Repeat the above calculations in the new situation