Because Wage Rates Are So Low in Africa, Why Don't

question 47

Essay

Because wage rates are so low in Africa, why don't Microsoft, Cisco and other major corporations close down their American operations and move to Africa?

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Definitions:

Total Variable Costs

The sum of all costs that vary with the level of output or production.

Variable Costs

Costs that change in proportion to the level of production or business activity, such as raw materials and labor expenses.

Fixed Costs

Costs that do not change with the level of production or sales, such as rent, salaries, and insurance.

Profit

The difference between total revenue and total cost.