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Harrison Hydraulics and the Yuan. Harrison Equipment of Denver, Colorado, purchases all of its hydraulic tubing from manufacturers in mainland China. The company has recently
Harrison Hydraulics 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 corporatewide initiative in six sigmalean manufacturing. Completed oil field hydraulic system costs were reduced
over a oneyear period, from $ to $ The company is now worried that all of the hydraulic tubing that goes into the systems making
up of their total costs will be hit by the potential revaluation of the Chinese yuanif some in Washington get their way. If the current spot rate is
yuan per dollar, how would a revaluation of the yuan against the dollar impact total system costs?
The current cost of the hydraulic tubing is $Round to the nearest cent.
After a revaluation of the yuan against the dollar, the cost of the hydraulic tubing will be $Round to the nearest cent.
The cost increase impact in total system costs as a result of the revaluation is $Round to the nearest cent.
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