Chinese Sourcing and the Yuan. Harrison Equipment of Denver, Colorado, purchases all of its hydraulic tubing from manufacturers in mainland China. The company has recently completed a corporate-wide initiative in six sigma/lean manufacturing. Completed oil field hydraulic system costs were reduced over a 3.2% one-year period, from 872,000 to 8353726. The company is now worried that all of the hydraulic tubing that goes into the systems (making up 18% of their total costs) will be hit by the potential revaluation of the Chinese yuan if some in Washington get their way. How would a 12.9% revaluation of the yuan against the dollar impact total system costs? Question content area bottom
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Chinese Sourcing and the Yuan. Harrison Equipment of Denver, Colorado, purchases all of its hydraulic tubing from manufacturers in mainland China. The company has recently completed a corporate-wide initiative in six sigma/lean manufacturing. Completed oil field hydraulic system costs were reduced over a 3.2% one-year period, from 872,000 to 8353726. The company is now worried that all of the hydraulic tubing that goes into the systems (making up 18% of their total costs) will be hit by the potential revaluation of the Chinese yuan if some in Washington get their way. How would a 12.9% revaluation of the yuan against the dollar impact total system costs? Question content area bottom
Part 1 The current cost of the hydraulic tubing is $ enter your response here. (Round to the nearest cent.)
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