John wants to buy a new lawn mower. He can either buy it in the US and pay $500 or buy it in Mexico and pay 8188 Mexican Pesos. At the exchange rate of 1 Mexican Peso=0.771US$, ignoring any other costs, he would

a. ?Prefer buying in the US
b. ?Prefer buying in Mexico
c. ?Be indifferent about where he buys his television
d. ?None of the above


Answer: a. ?Prefer buying in the US

Economics

You might also like to view...

What is the opportunity cost of moving from point B to point A?


Economics

When did the UK decide to adopt the Euro?

A) 1999 B) 2001 C) 2008 D) The UK has not adopted the Euro. E) 2010

Economics

Savings accounts, certificates of deposit, and bonds pay interest and stocks pay dividends. Why does anyone hold on to currency or other forms of money and lose this extra income?

What will be an ideal response?

Economics

The basic incentive problem associated with internal transfers is that:

A. divisional managers have only public information about opportunity costs. B. divisional managers have private information about opportunity costs. C. senior management make all information about opportunity costs public. D. senior management have private information about opportunity costs.

Economics