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Cindy's Computer Corp. is considering a merger with Bobby's Hard Drive, Inc. Cindy's total operating costs of producing services are $4.3 million for a sales
Cindy's Computer Corp. is considering a merger with Bobby's Hard Drive, Inc. Cindy's total operating costs of producing services are $4.3 million for a sales volume (SJ) of $26 million. Bobby's total operating costs of producing services are $3.4 million for a sales volume (Sp) of $13 million. a. Calculate the average cost of production for the two firms. (Round your answers to 2 decimal places.) Cindy's Computer Corp. Bobby's Hard Drive, Inc. Average Cost % % b. If the two firms merge, calculate the total average cost (TAC) for the merged firm assuming no synergies. (Round your answer to 2 decimal places.) Total average cost 1% c. Suppose, instead, that synergies in the production process result in a cost of production for the merged firms totaling $7.1 million for a sales volume of $39 million. Calculate the total average cost (AcindyBobby) for the merged firm. (Round your answer to 2 decimal places.) Total average cost %
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