If an automobile costs $32,000 in New York and $1 = 0.8 euros, then under the condition of the law of one price, the cost of the automobile in Rome should be:
A) 32,000 euros.
B) 40,000 euros.
C) 35,000 euros.
D) 25,600 euros.

Question

Quizplus · Accepted Answer

According to the law of one price, the cost in Rome should be the same as in New York when converted to euros. $32,000 * 0.8 euros/$ = 25,600 euros.

If an Automobile Costs $32,000 in New York and $1