SupposeHewlett-Packard is considering outsourcing itstelephone-based technical support functions for its printers to India. The hourly cost of a tech support person in the United States is$50 per hour. InIndia, workers are paid in rupeesbut, at the current exchangerate, are paid the equivalent of$20 per hour.

However, calls serviced in India require paying for long distance telephone service. Initially the telephone costs were about$35 per hour. However, a switch to voice over internet protocol(VIOP) technology reduced the telephone cost to$25 per hour. Explain how the technological change affects the decision of where to base service.

1. Before the switch toVIOP, it was optimal forHewlett-Packard to base its technical support functions for printers in (india/US PICK ONE)
2. after theswitch, it is optimal forHewlett-Packard to base its technical support functions for printers in (india/US PICK ONE)