velue: .00 points Suppose a French bottle of champagne costs 23 euros a. If the

Question

velue: .00 points Suppose a French bottle of champagne costs 23 euros a. If the euro-dollar exchange rate is 0.94 euro per dollar, so that a dollar can buy 0.94 euro, how much will the champagne cost in the United States? Instructions: Enter your response rounded to two decimal places. Price of champagne in the United States: b. If the euro-dollar exchange rate rises to 1.30 euros per dollar, how much will the champagne cost in the United States? Instructions: Enter your response rounded to two decimal places. Price of champagne in the United States: c. If an increase in the euro-dollar exchange rate leads to an increase in Americans' dollar expenditures on French champagne, what will happen to the amount of dollars supplied to the foreign exchange market as the euro-dollar exchange rate rises? The amount of dollars supplied to the foreign exchange market wi (Click to select) decrease

Explanation / Answer

a) The answer is  $24.47

because, price of champagne = 23 euro.

and euro dollar exchange rate is equal to 0.94

so price of champage in US dollar = 23/0.94 = 24.47

b) The answer is $17.70

price of cganpagne is US dollar = 23/1.3 = 17.70

c) Increases

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