Suppose that Argentina's dollar-denominated external assets and liabilities are $10 billion and $100 billion, respectively, and its Argentine peso-denominated external assets and liabilities are each 50 billion pesos (P). Suppose further that Argentina fixes its exchange rate at P1 = $US1. What is the peso value of Argentina's total external wealth?

A) -60 billion pesos
B) -150 billion pesos
C) -0 billion pesos
D) -90 billion pesos


Ans: D) -90 billion pesos

Economics

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