Airbus is a passenger aircraft manufacturer based in Europe but, like the rest of the global aerospace industry, conducts its business in U.S.dollars.Suppose Airbus sells an aircraft to Air France, and Air France pays Airbus in U.S.dollars.If the value of the U.S.dollar falls relative to the euro, Airbus's profits in Europe will ________ because it will receive ________ when it converts the dollars it earns from the sale into euros.

Question

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If the value of the U.S. dollar falls relative to the euro, Airbus will receive fewer euros when converting the dollars from the sale, leading to lower profits in Europe.

Airbus Is a Passenger Aircraft Manufacturer Based in Europe But