richard on Nostr: Bob in the US buys avocados from Alicia in MX. Bob paid Alicia $100 pre tarrif. If ...

Bob in the US buys avocados from Alicia in MX. Bob paid Alicia $100 pre tarrif. If Alicia wants the same net, she would have to sell for $133 with the 25% tarrif.

Price P−0.25P=net n
0.75P=n
P=n/0.75
P=1.33n

This is ok for Alicia, she lives on pesos

Bob lives on fruits and nuts, 44% of which come from MX

To support this Bob needs to pay 15% more buying fruits and nuts.

1.33*.44+.56 ~= 1.15

Fruits and nuts are 10% of his expenses

1.15*.1+.9=1.015

If Bob previously netted $100 selling avocados @ $200 he now needs to net $102 rounding pennies. So

133+102= $237 a $37 increase or 19%

A 25% tarrif does not mean a 25% increase in price.

Is there some truth to what I presented or method to my madness?

#asknostr