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26 May, 14:39

A computer manufacturer sells laptops to retail stores for $450 each. If the manufacturer pays $200 for all of the components in each laptop and $75 in wages to it's workers, the value added to each computer by manufacturing is is $250 or $175?

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  1. 26 May, 14:44
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    The answer is $75

    Explanation:

    The formula to reach out value addition is

    Value Addition=Sales Value-Cost of manufacture or input added

    In our Case

    Sales Price=$450

    Cost of Manufacture or Input=200+75=$275

    So by entering above numbers in Value Addition formula we get

    Value Addition=$450-$275

    Value Addition=$175
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