Directions (1 to 5): Answer the following questions based on the information given below.
The table below shows the comparative costs, in US Dollars, of certain items in USA and a select few Asian countries. The models considered are the most popular ones in the respective countries.
| Product | Comparative Costs in USA and some Asian countries (in US Dollars) | |||||
| USA | India | Thailand | Singapore | Malaysia | ||
| LCD TV | 2300 | 1000 | 1100 | 1850 | 900 | |
| Home gym | 1900 | 900 | 1000 | 1250 | 900 | |
| Refrigerator | 2000 | 1100 | 1300 | 1300 | 1100 | |
| Air conditioner | 2300 | 900 | 1200 | 1200 | 1000 | |
| Washing machine | 1200 | 300 | 450 | 600 | 300 | |
| Music system | 2000 | 850 | 1000 | 1300 | 800 | |
| Digital camera | 1600 | 550 | 700 | 900 | 600 | |
The equivalent of one US Dollar in the local currencies is given below.
| 1 US Dollar equivalent | ||
| India | 40.93 | Rupees |
| Malaysia | 3.51 | Ringits |
| Thailand | 32.90 | Bahts |
| Singapore | 1.53 | S Dollars |
A consulting firm found that the quality of the products was not the same in all the countries above. A poor quality product would result in higher servicing costs over its life time. The cost of poor quality of the products is given in the table
| Products | Comparative service cost in USA and Asian countries (in US Dollars) | ||||
| USA | India | Thailand | Singapore | Malaysia | |
| LCD TV | 0 | 300 | 300 | 200 | 400 |
| Home gym | 0 | 500 | 400 | 500 | 500 |
| Refrigerator | 0 | 500 | 500 | 400 | 600 |
| Air Conditioner | 0 | 700 | 500 | 500 | 800 |
| Washing machine | 0 | 500 | 600 | 500 | 400 |
| Music system | 0 | 900 | 600 | 400 | 400 |
| Digital camera | 0 | 500 | 600 | 500 | 600 |
Note: For all questions assume that the models considered are the ones for which the prices are mentioned
Q1. A US citizen requires a refrigerator, air conditioner and a music system. He can buy them through an internet portal from any of the given countries without having to pay for any transportation costs. Which country will result in the cheapest overall cost, taking cost of poor quality into account?
1. India
2. Thailand
3. Malaysia
4. Singapore
5. USA
Q2.Taking the cost of poor quality into account, which country/countries will be the most expensive if one has to buy a music system?
1. India
2. Thailand
3. USA
4. Singapore
5. India and Singapore
Q3. Approximately what difference in Bahts will it make to a Thai citizen who is touring India if she were to get a washing machine from India instead of her native country, taking into account the cost of poor quality? One has to pay a duty of 1500 Bahts for transporting the washing machine from India to Thailand.
1. 10000
2. 15000
3. 8000
4. 14000
5. 9500
Q4.The rupee values increases to 35 for a US Dollar, and all other things including quality, remain the same. What is the approximate difference in cost, in US Dollars, between Singapore and India for a digital camera, taking this change into account?
1. 70
2. 350
3. 430
4. 800
5. No difference
Q5. Taking the cost of poor quality into account, which country/countries will be the cheapest if one has to buy a Refrigerator?
1. India
2. Thailand
3. USA
4. Singapore
5. India and Singapore
Answer & Explanation 1.3 Required answer is Malaysia. 2.3 Required answer is USA. 3.1 Total Cost of Washing machine in India = 300+500Dollar = 800 dollar 4.2 Required Difference = 900-550 = 350 dollar 5.1 Required answer is India.
Refrigerator Music system Air Conditioner Total USA 2000+0 2000+0 2300+0 6300 India 1100+500 850+900 900+700 4950 Thailand 1300+500 1000+600 1200+500 5100 Malaysia 1100+600 800+400 1000+800 4700 Singapore 1300+400 1300+400 1200+500 5100
Transportation charge = 1500 Bahts = 1500/32.90 = 45.6 dollar
Total Cost of Washing machine in India = 800+45.6 = 845.6 dollar
Total Cost of Washing machine in Thailand = 450+600Dollar = 1150 dollar
Difference = 1150-845.6 = 304.4 dollar = 10014.7