The extent to which a foreign company changes dollar prices of its products in the U.S.market as a result of exchange rate fluctuations is called exchange rate pass-through.

Question

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Exchange rate pass-through refers to the degree to which the prices of imported goods change in the domestic market of the importer (in this case, the U.S. market) as a result of exchange rate fluctuations between the domestic currency and the currency of the exporting country.

The Extent to Which a Foreign Company Changes Dollar Prices