a. Equilibrium points: The given data indicates that the two companies working together will create a loss of $10 billion each, one company alone producing can create a profit of $100 billion. If none make semiconductors, profits remain $0. Based on the given data, a two-sum payoff matrix can be prepared as below:

Question

A company owns the same asset in a ASIAN plant and in a UK plant . It has B $2,000,000 and a salvage value of 20% of B . For tax depreciation purposes, ASIA allows a straight line write-off over 5 years, while the UK allows SL write-off over 8 years. The general managers of the two plants want to know the difference in the depreciation amount for year 5.

Answer 1

Expert Solution & Answer

Chapter 14.4, Problem 5P

Explanation of Solution

a.

Equilibrium points:

The given data indicates that the two companies working together will create a loss of $10 billion each, one company alone producing can create a profit of $100 billion. If none make semiconductors, profits remain $0.

Based on the given data, a two-sum payoff matrix can be prepared as below:

Explanation of Solution

b.

Equilibrium points:

From the above matrix, to be considered a subsidy of $15 billion to the Japanese company.

Then the matrix becomes,

Japanese

Explanation of Solution

c)

Viewpoint supported by the problem:

Protectionism can have short term benefits but on the long term makes consumer devoid of options and slows down the economy as a whole.

This is why economists mention about the theory of comparative advantage...

Expert Solution & Answer

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A company owns the same asset in a ASIAN plant and in a UK plant . It has B $2,000,000 and a salvage value of 20% of B . For tax depreciation purposes, ASIA allows a straight line write-off over 5 years, while the UK allows SL write-off over 8 years. The general managers of the two plants want to know the difference in the depreciation amount for year 5.

You are trying to estimate NPV of profit for a newcomputer product, which you are confident will sell for tenyears. You are given the following information.The hurdle rate is 15%. Assume end of year for profits.The total cost of developing the product will be spreadequally over the product’s life. Total development cost willbe between $2 billion and $11 billion. There is a 25% chancethat total fixed cost is $3 billion or less, a 50% chance of $6billion or less, and a 75% chance of $9 billion or less.The total year 1 market size (in terms of annual unitsales) is unknown but is believed to be between 0 and 600million units. Unit sales of 100 million and 500 million areequally likely. Unit sales of 200 million and 400 million areequally likely, and are 4 times as likely as sales of 100million. Sales of 300 million are 5 times as likely as salesof 100 million. Each year, market growth is expected toaverage 5%, and during each year we are 95% sure thatmarket growth will be between 3% and…

Pretend you have five employees who would like to know exactly how much their bi-weekly pay will be once all of their deductions are taken off. Their weekly pay is as follows: Emp #1. $1100 Emp #2. $1300 Emp #3. $1500 Emp #4. $1700 Emp #5. $2300 *Taxation *

Answer 2

Expert Solution & Answer

Chapter 14.4, Problem 5P

Explanation of Solution

a.

Equilibrium points:

The given data indicates that the two companies working together will create a loss of $10 billion each, one company alone producing can create a profit of $100 billion. If none make semiconductors, profits remain $0.

Based on the given data, a two-sum payoff matrix can be prepared as below:

Explanation of Solution

b.

Equilibrium points:

From the above matrix, to be considered a subsidy of $15 billion to the Japanese company.

Then the matrix becomes,

Japanese

Explanation of Solution

c)

Viewpoint supported by the problem:

Protectionism can have short term benefits but on the long term makes consumer devoid of options and slows down the economy as a whole.

This is why economists mention about the theory of comparative advantage...

Expert Solution & Answer

Trending nowThis is a popular solution!

See solution

Check out sample textbook solution

Answer 3

Expert Solution & Answer

Chapter 14.4, Problem 5P

Explanation of Solution

a.

Equilibrium points:

The given data indicates that the two companies working together will create a loss of $10 billion each, one company alone producing can create a profit of $100 billion. If none make semiconductors, profits remain $0.

Based on the given data, a two-sum payoff matrix can be prepared as below:

Explanation of Solution

b.

Equilibrium points:

From the above matrix, to be considered a subsidy of $15 billion to the Japanese company.

Then the matrix becomes,

Japanese

Explanation of Solution

c)

Viewpoint supported by the problem:

Protectionism can have short term benefits but on the long term makes consumer devoid of options and slows down the economy as a whole.

This is why economists mention about the theory of comparative advantage...

Expert Solution & Answer

Trending nowThis is a popular solution!

See solution

Check out sample textbook solution

Answer 4

Expert Solution & Answer

Chapter 14.4, Problem 5P

Explanation of Solution

a.

Equilibrium points:

The given data indicates that the two companies working together will create a loss of $10 billion each, one company alone producing can create a profit of $100 billion. If none make semiconductors, profits remain $0.

Based on the given data, a two-sum payoff matrix can be prepared as below:

Explanation of Solution

b.

Equilibrium points:

From the above matrix, to be considered a subsidy of $15 billion to the Japanese company.

Then the matrix becomes,

Japanese

Explanation of Solution

c)

Viewpoint supported by the problem:

Protectionism can have short term benefits but on the long term makes consumer devoid of options and slows down the economy as a whole.

This is why economists mention about the theory of comparative advantage...

Expert Solution & Answer

Trending nowThis is a popular solution!

See solution

Check out sample textbook solution

Answer 5

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Answer 6

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Answer 7

Chapter 14.4, Problem 5P

Explanation of Solution

a.

Equilibrium points:

The given data indicates that the two companies working together will create a loss of $10 billion each, one company alone producing can create a profit of $100 billion. If none make semiconductors, profits remain $0.

Based on the given data, a two-sum payoff matrix can be prepared as below:

Explanation of Solution

b.

Equilibrium points:

From the above matrix, to be considered a subsidy of $15 billion to the Japanese company.

Then the matrix becomes,

Japanese

Explanation of Solution

c)

Viewpoint supported by the problem:

Protectionism can have short term benefits but on the long term makes consumer devoid of options and slows down the economy as a whole.

This is why economists mention about the theory of comparative advantage...

Answer 8

Chapter 14.4, Problem 5P

Explanation of Solution

a.

Equilibrium points:

The given data indicates that the two companies working together will create a loss of $10 billion each, one company alone producing can create a profit of $100 billion. If none make semiconductors, profits remain $0.

Based on the given data, a two-sum payoff matrix can be prepared as below:

Answer 9

Chapter 14.4, Problem 5P

Explanation of Solution

a.

Equilibrium points:

The given data indicates that the two companies working together will create a loss of $10 billion each, one company alone producing can create a profit of $100 billion. If none make semiconductors, profits remain $0.

Based on the given data, a two-sum payoff matrix can be prepared as below:

Answer 10

Explanation of Solution

b.

Equilibrium points:

From the above matrix, to be considered a subsidy of $15 billion to the Japanese company.

Then the matrix becomes,

Japanese

Answer 11

Explanation of Solution

b.

Equilibrium points:

From the above matrix, to be considered a subsidy of $15 billion to the Japanese company.

Then the matrix becomes,

Japanese

Answer 12

Explanation of Solution

c)

Viewpoint supported by the problem:

Protectionism can have short term benefits but on the long term makes consumer devoid of options and slows down the economy as a whole.

This is why economists mention about the theory of comparative advantage...

Answer 13

Explanation of Solution

c)

Viewpoint supported by the problem:

Protectionism can have short term benefits but on the long term makes consumer devoid of options and slows down the economy as a whole.

This is why economists mention about the theory of comparative advantage...

Answer 14

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Answer 15

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Answer 25

Ch. 14.4 - Prob. 5P

Solution Summary: The author explains that the two companies working together will create a loss of 10 billion each, and one company alone producing can create profits of 100 billion.

Explanation of Solution

Explanation of Solution

b.

Equilibrium points:

From the above matrix, to be considered a subsidy of $15 billion to the Japanese company.

Then the matrix becomes,

Japanese

Explanation of Solution

c)

Viewpoint supported by the problem:

Protectionism can have short term benefits but on the long term makes consumer devoid of options and slows down the economy as a whole.

This is why economists mention about the theory of comparative advantage...

Chapter 14 Solutions

Solution Summary: The author explains that the two companies working together will create a loss of 10 billion each, and one company alone producing can create profits of 100 billion.

Explanation of Solution

Explanation of Solution

b. Equilibrium points: From the above matrix, to be considered a subsidy of $15 billion to the Japanese company. Then the matrix becomes, Japanese

Explanation of Solution

c) Viewpoint supported by the problem: Protectionism can have short term benefits but on the long term makes consumer devoid of options and slows down the economy as a whole. This is why economists mention about the theory of comparative advantage...

Chapter 14 Solutions

b.

Equilibrium points:

From the above matrix, to be considered a subsidy of $15 billion to the Japanese company.

Then the matrix becomes,

Japanese

c)

Viewpoint supported by the problem:

Protectionism can have short term benefits but on the long term makes consumer devoid of options and slows down the economy as a whole.

This is why economists mention about the theory of comparative advantage...