If the exchange rate is 3 units of Peruvian currency per dollar and a hotel room in Lima costs 300 units of Peruvian currency, then how many dollars do you need to get a room?
A)900 and your purchase will increase Peru's net exports.
B)100 and your purchase will increase Peru's net exports.
C)900 and your purchase will have no effect on Peru's net exports.
D)100 and your purchase will have no effect on Peru's net exports.

Question

Quizplus · Accepted Answer

To convert 300 units of Peruvian currency to dollars, we need to divide by the exchange rate:
300/3 = 100
Therefore, we need 100 dollars to get a room. Since we are using dollars to make the purchase, it will increase Peru's net exports. Choice B is the best answer.

If the Exchange Rate Is 3 Units of Peruvian Currency