1. what are productivity-adjusted wages and why they enter the calculation of manufacturing costs in place of (unadjusted) wages? Please include the Ricardian model in your answer. 2. Your boss is confused by the graph of Manufacturing Cost Index, by country. Please explain how to interpret the graph and what the Manufacturing Cost Index captures. 3. Based on the Manufacturing Cost Index and other economic factors, which of the world’s top 25 export economies should you seriously consider for offshoring?
1. what are productivity-adjusted wages and why they enter the calculation of manufacturing costs in place of (unadjusted) wages? Please include the Ricardian model in your answer. 2. Your boss is confused by the graph of Manufacturing Cost Index, by country. Please explain how to interpret the graph and what the Manufacturing Cost Index captures. 3. Based on the Manufacturing Cost Index and other economic factors, which of the world’s top 25 export economies should you seriously consider for offshoring?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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1. what are productivity-adjusted wages and why they enter the calculation of manufacturing costs in place of (unadjusted) wages? Please include the Ricardian model in your answer.
2. Your boss is confused by the graph of Manufacturing Cost Index, by country. Please explain how to interpret the graph and what the Manufacturing Cost Index captures.
3. Based on the Manufacturing Cost Index and other economic factors, which of the world’s top 25 export economies should you seriously consider for offshoring?
Transcribed Image Text:The world's top 25 export economies
Manufacturing cost index, United States=100
Ranked by volume of exports, 2014 estimates
O 20 40 60 80 100 120 140
China
Germany
United States
Jаpan
South Korea
France
Italy
Netherlands
Belgium
Britain
Canada
Russia
Mexico
Taiwan
India
Switzerland
Australia
Spain
Brazil
Thailand
Indonesia
Poland
Sweden
Austria
Czech Republic
Source: Boston Consulting Group
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