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If the Exchange Rate Is Initially $1 = 12

Question 17

Multiple Choice

If the exchange rate is initially $1 = 12.95 pesos but changes to $1 = 15 pesos, then the dollar has _____ and the price in Mexico of a $10,000 U.S.-built Harley Davidson motorcycle has _____.


A) depreciated; decreased
B) depreciated; increased
C) appreciated; increased
D) appreciated; decreased

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