If oranges sell for $100 per crate in the United States and 4000 pesos per crate in Mexico, the law of one price indicates that you should be able to exchange $1 for

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The law of one price states that the price of a good should be the same in all markets, taking into account the cost of transportation and exchange rates. In this case, the price of a crate of oranges is $100 in the United States and 4000 pesos in Mexico. To find the exchange rate, we can divide the price in Mexico by the price in the United States: 4000 pesos / $100 = 40 pesos per dollar. Therefore, you should be able to exchange $1 for 40 pesos.

If Oranges Sell for $100 Per Crate in the United