Question 2 Myros Ltd is the UK Distributor of Wasch brand televisions. It sources its stock from its parent company in Mexico. The only value added to the televisions by Myros Ltd is the provision of English Language instruction manuals and delivery to wholesale customers. The margin earned by similar television distribution firms in the UK is 20%. The price per television to the final customer is $4,000. The cost per television to Myros Ltd is $3,000. The cost of adding the instructions manuals is $25.

Calculate the arms length price using the resale price method and what are the arguments that could be put forward to the Mexican Authority by the parent company in Mexico to defend its price.