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Several years pass and many firms have now entered the call center industry in the Philippines instead of the US. As a result of this
Several years pass and many firms have now entered the call center industry in the Philippines instead of the US. As a result of this additional entry, labor prices in the Philippines have increased. Thus, the total cost curve for firms running call centers in the Philippines has increased to be: TCPhilippines = 16 +q2 where q is the number of call centers operated by a firm. The estimated number of firms running call centers in the Philippines is now 200. In response to political pressure over perceived outsourcing of call centers to the Philippines, the US government decides to impose a tax of $10,000 (i.e., tax = 1, in tens of thousands of dollars) on call centers owned by US firms in the Philippines. For simplicity, assume that all of the call centers in the Philippines represent call centers owned by US firms. You may assume that the overall demand function is unchanged (i.e., the demand curve is the same as above)
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