Cindys Computer Corp is considering a merger with Bobbys Hard Drive, Inc Cindys total operating costs of producing services are $5 1 million for a sales volume ( S C ) of $42 million Bobbys total operating costs of producing services are $4 2 million for a sales volume ( S B ) of $21 million Calculate the average cost of production for the two firms (Round your answers to 2 decimal places ) Cindys Computer Corp Bobbys Hard Drive, inc If the two firms merge, calculate the total average cost ( TAC ) for the merged firm assuming no synergies (Round your answer to 2 decimal places ) Total Avg Cost Suppose, instead, that synergies in the production process result in a cost of production for the merged firms totaling $8 7 million for a sales volume of $63 million Calculate the total average cost ( AC CindyBobby ) for the merged firm (Round your answer to 2 decimal places ) Total Avg Cost

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Question: Cindys Computer Corp. is considering a merger with Bobbys Hard Drive, Inc. Cindys total operating costs of producing services are $5.1 million for a sales

Cindys Computer Corp. is considering a merger with Bobbys Hard Drive, Inc. Cindys total operating costs of producing services are $5.1 million for a sales volume (S_C) of $42 million. Bobbys total operating costs of producing services are $4.2 million for a sales volume (S_B) of $21 million.

Calculate the average cost of production for the two firms. (Round your answers to 2 decimal places.)

Cindys Computer Corp. ____ %

Bobbys Hard Drive, inc. __________ %

If the two firms merge, calculate the total average cost (TAC) for the merged firm assuming no synergies. (Round your answer to 2 decimal places.)

Total Avg Cost ______ %

Suppose, instead, that synergies in the production process result in a cost of production for the merged firms totaling $8.7 million for a sales volume of $63 million. Calculate the total average cost (AC_CindyBobby) for the merged firm. (Round your answer to 2 decimal places.)

Total Avg Cost ______ %

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