Wolf Andersson working for Cablez Newz Netwerken (CNN) was analyzing the problem of where to manufacture transponders. Currently CNN manufactured transponders in Bavaria, Germany, but transponders manufactured in Izmir Turkey were becoming highly competitive both in terms of price and quality. Wolf of course realized that importing from Turkish manufacturers was no Turkish delight and he could gain greater control over operations by setting up a CNN factory in Turkey. Of course, by manufacturing transponders in Turkey CNN could not avoid paying tariffs imposed in Germany on transponder imports. He also thought about the looming integration of Turkey into the European Union and wondered how this would affect his decision. He had the following data to help him (?ll data is per 1 transponder and expressed in Euros)
Cost of capital in Germany. -0,60
Cost of labor in Germany – a -165
Cost of capital in Turkey 2-0.90
Cost of labor in Turkey 3,-0.40
Transportation costs from Turkey to Germany. -0,20
Tariffe in Germany on imports of transponders-A-025
Cost of German capital in Turkey: -0.85
Cost of Turkish labor in Germany.3.0.80
Please help Wolf by answering the following questions
What is the current cost of CNN transponders made in Germany?
