Question

In: Finance

A computer costs $430 in the United States. The same model costs 770 euros in France....

A computer costs $430 in the United States. The same model costs 770 euros in France. If purchasing power parity holds, what is the spot exchange rate between the euro and the dollar? Do not round intermediate calculations. Round your answer to two decimal places.

$1 =______ euros

Solutions

Expert Solution

Based on Purchasing Parity Principle and data in question,

$430 = 770 Euros

1$ = (770/430) Euros

$1 = 1.79 Euros

jeff jeffy answered 2 years ago
Next > < Previous

Related Solutions

Purchasing Power Parity A computer costs $460 in the United States. The same model costs 725...
Purchasing Power Parity A computer costs $460 in the United States. The same model costs 725 euros in France. If purchasing power parity holds, what is the spot exchange rate between the euro and the dollar? Do not round intermediate calculations. Round your answer to two decimal places.
Suppose a Starbucks tall latte costs $4.00 in the United States and 2.50 euros in the...
Suppose a Starbucks tall latte costs $4.00 in the United States and 2.50 euros in the Euro area. Also, suppose a McDonald’s Big Mac costs $4.50 in the United States and 3.60 euros in the Euro area. If the nominal exchange rate is .80 euros per dollar, which goods have prices that are consistent with purchasing-power parity? a. the tall latte but not the Big Mac b. the Big Mac but not the tall latte c. both the tall latte...
a. “Industrialised countries such as the United States of America, Germany, France and the United Kingdom...
a. “Industrialised countries such as the United States of America, Germany, France and the United Kingdom dominate world trade.” Can you relate this statement with one of the recent theories/models of international trade which predicts that more trade will take place between similar countries? What assumptions of the factor proportions model does this theory violate? Explain your answers.
A pair of shoes cost 80 euros in France. The same pair of shoes cost $100...
A pair of shoes cost 80 euros in France. The same pair of shoes cost $100 in the U.S. Assuming you would like to pay less, where would you buy the shoes? Suppose instead the exchange rate is $1.3 per euro. What is the $ price of shoes in France? Assuming you would like to pay less, where would you buy the shoes?
When comparing the healthcare system in France with that in the United States, one of the...
When comparing the healthcare system in France with that in the United States, one of the key differences is that the French are able to obtain lower overall healthcare costs because the government is the only payer of healthcare expenses, and there is no private insurance. the French are able to obtain lower overall healthcare costs because the government pays for most medical care, and private health insurance is held by nearly all to cover the remainder of needed medical...
Compare and contrast the health care systems in the United States and France.
Compare and contrast the health care systems in the United States and France.
Compare and Contrast France VS United States Quality of healthcare systems
Compare and Contrast France VS United States Quality of healthcare systems
Compare and Contrast France VS United States Structure of Healthcare System
Compare and Contrast France VS United States Structure of Healthcare System
How do ethical practices differ in the United States, and in European countries such as France...
How do ethical practices differ in the United States, and in European countries such as France and Germany? What implications does your answer have for U.S. multinationals operating in Europe?
Compare and Contrast the QUALITY of France VS United States Structure of Healthcare System
Compare and Contrast the QUALITY of France VS United States Structure of Healthcare System
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT