Discussion Mod 2
Production and Cost
In an effort to stop the migration of many of the automobile manufacturing facilities from the Detroit area, Detroit’s City Council is considering passing a statute that would give investment tax credits to automobile manufacturers. This would reduce auto manufacturer’s costs of using capital and high tech equipment in their production processes.
- As a local union representative you voice your opposition to the statute. Outline the basis of your arguments as a union representative (Hint: consider the impact that the investment tax credit would have on the capital/labor ratio as a result of the increase in the price of capital/price of labor ratio).
- As a representative for one of the automakers, how would you counter the arguments of the union representative?
Assignment Requirement:
Minimum 1 Page Double Space, APA Format, 2-3 Credible Sources for References
Reading Required:
Beveridge, T. M. (2013). Chapter 5: Production, costs, and revenues. A Primer on Microeconomics. Business Expert Press, New York, NY. (see attached Below)
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