Consider a firm that sells its product in both the U$.$S$.$ and the U$.$K$.$ U$.$S$.$ demand is for $12,000$ units, and the U$.$S$.$

production capacity is $17,000$ units. Demand in the U$.$K$.$ is for $8,000$ units, and the U$.$K$.$ production capacity is $12,000$

units. Production cost in the U$.$S$.$ is $$3\mathrm{.}4,$ and production cost in the U$.$K$.$ is $7.$ The current exchange rate is $$1\mathrm{.}36=1.$

The shipping cost is $$1\mathrm{.}6$ per unit for any units shipped between the two countries. Sales prices equate to $$110$ in each

country.

a$)$ How many should be made in each country?

U$.$S$.=$ units.

U$.$K$.=$ units.

b$)$ How much is the profit for each country?

U$.$S$.$ Profit $=$$$,($round your response to the nearest dollar$).$

U$.$K$.$ Profit $=$ $ $($round your response to the nearest dollar$).$