Assume that the exchange rate between the dollar and the euro is €1 = $1. Suppose the exchange rate changes to €1.25 = $1. What is the price in dollars of a €200 pair of Italian shoes before and after the exchange rate change?
A)$200 before; $160 after
B)$200 before; $250 after
C)$160 before; $125 after
D)$125 before; $160 after

Question

Quizplus · Accepted Answer

Before the change, €200 = $200. After the change, €200 = $160.

Assume That the Exchange Rate Between the Dollar and the Euro