Question: Show me the steps to solve In 2 0 2 4 , Tesla Inc. acquired a battery manufacturing plant in Turkey. Turkey's inflation rate was

Show me the steps to solveIn 2024, Tesla Inc. acquired a battery manufacturing plant in Turkey. Turkey's inflation rate was 40% in 2024 and 45% in 2025, while the Turkish lira depreciated by 10% and 20%, respectively, during those years. Corresponding inflation for the U.S. was 5% in 2024 and 4% in 2025.
(a) What has happened to the competitiveness of Tesla's Turkish operations during 2024 and 2025? Explain.(Hints: consider the real exchange rate of Turkish lira)(12marks)
(b) In early 2026, Tesla announced it would reduce its investment in the Turkish plant. What might have been the purpose of Tesla's publicly announced reduction? (7marks)
(c) How are Tesla's customers and suppliers in Turkey likely to respond to this new policy? (8marks)

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