Figure 19.1

-Referring to Figure 19.1, U.S. goods will become more expensive in Mexico if the exchange rate goes from ________ to ________ pesos to the dollar.

Question

Figure 19.1
 
-Referring to Figure 19.1, U.S. goods will become more expensive in Mexico if the exchange rate goes from ________ to ________ pesos to the dollar.

Quizplus · Accepted Answer

When the exchange rate goes from 12 to 13 pesos to the dollar, it means that each dollar now buys more pesos. Therefore, U.S. goods become more expensive in Mexico because Mexicans have to spend more pesos to buy the same amount of dollars to purchase U.S. goods.

Figure 19.1 -Referring to Figure 19.1, U.S. Goods Will Become More Expensive