Suppose a Mexican consumer wants to buy an American television for $700 and an American wants to buy a Mexican raincoat for 800 pesos. If the exchange rate is $0.10 = 1 peso, then the price of the television in pesos will be __________ pesos and the price of the raincoat in dollars will be __________.

Question

Quizplus · Accepted Answer

To convert the price of the television from dollars to pesos, multiply $700 by the exchange rate's inverse (1 peso/$0.10 = 10 pesos/$1), resulting in 700*10 = 7,000 pesos. To convert the price of the raincoat from pesos to dollars, multiply 800 pesos by $0.10/peso, resulting in $80.

Suppose a Mexican Consumer Wants to Buy an American Television