Suppose 144 yen could be purchased in the foreign exchange market for one U.S.dollar today.If the yen depreciates by 13.0% tomorrow,how many yen could one U.S.dollar buy tomorrow?

Question

Quizplus · Accepted Answer

If 144 yen could be purchased for one U.S. dollar today, then tomorrow the dollar will be able to purchase more yen as the yen depreciates. 
The yen will depreciate by 13.0%, meaning that it will be worth 87% of its original value (100%-13% = 87%). 
To calculate the new exchange rate, we can multiply the original exchange rate by the percentage value of the yen: 
144 yen/dollar x 0.87 = 125.28 yen/dollar
Therefore, one U.S. dollar could buy 125.28 yen tomorrow. 
Option D (162.7200) is incorrect as it is the original exchange rate.

Suppose 144 Yen Could Be Purchased in the Foreign Exchange