--%>
Assignment Help - homework help

Depreciation of the euro change the dollar price

If the European euro declines in value (depreciates) in the foreign exchange market, would it be easier or harder for the French to sell their wine in the United States?  Suppose you were planning a trip to Paris.  How would the depreciation of the euro change the dollar price of this trip?

E

Expert

Verified

If the European euro declines in value, it means that Americans can receive more francs for each dollar. Therefore, they do not need as many dollars to pay the franc price of a bottle of French wine, so the quantity demanded would rise and it should be easier to sell French wine in the U.S.  Likewise, the franc depreciation would make it less costly for Americans to travel in France, since the dollar would now buy more francs (assuming that prices inside France have not risen to entirely offset the depreciation of the franc).

   Related Questions in Business Economics

  • Q : Describe unequal burdens of

    Describe unequal burdens of unemployment exist?

    		•
  • Q : Introduction of the term Cost of capital

    Give a brief introduction of the term Cost of capital?

    		•
  • Q : Market Apparent program For the

    For the question below, utilize the given information. The market for gizmos is competitive, with an increasing sloping supply curve and a downward sloping demand curve. With no govt. intervention, the equilibrium price is $25 and the equilibrium quantity is 10,000 gi

    		•
  • Q : Importance of rationally optimal

    Economic scarcity is pervasive, that makes choices essential. Therefore, rationally optimal decisions hinge upon tradeoffs which essentially reflect: (i) cooperation to minimize human greed. (ii) opportunity costs. (iii) competitive social behavior. (

    		•
  • Q : Define the natural price by Adam Smith

    In words of Adam Smith, who theorized that the “natural price” of a good based most directly upon the: (1) wage rate and the relative amount of labor required to produce the good. (2) greater of the value of the good &ldqu

    		•
  • Q : Main economic functions of government

    Enumerate and briefly discuss the main economic functions of government.  Which of these functions do you think is the most controversial?  Why?

    		•
  • Q : Gross domestic product Question Would

    Question Would "Victory Points" be a measure of player's "GDP"? If not, then how would you calculate a player's GDP?

  • Q : What are the benefits and costs of

    What are the benefits and costs of Marginalism?

    		•
  • Q : Example of self interest to define

    The concept of _____ was demonstrated by _____ along with the quotation, “The defeat of a bit finger would remain the average European from sleeping which night,... but, given he never saw them, he will snore along with the most profound security over the loss o

    		•
  • Q : Reason of Economic problem Why an

    Why an economic problem does arise? Answer: It arises due to following reasons: A) Shortage of resources. B) Alternative utilizations of resources. C) Limitless wants and limited resources.

    		•