If we ignore transportation costs and the price of a pair of Nike shoes in Detroit is $100 U.S.what should be the price of the Nike shoes in Windsor, Canada (in Canadian dollars) if the nominal exchange rate is 1.36 Canadian dollars/1 U.S.dollar?
A)74
B)100
C)136
D)64

Question

Quizplus · Accepted Answer

The price of the Nike shoes in Windsor, Canada would be $136 Canadian dollars, which is obtained by multiplying the U.S. dollar price of $100 by the nominal exchange rate of 1.36 Canadian dollars/1 U.S. dollar.

If We Ignore Transportation Costs and the Price of a Pair