How many dollars would an importer receive for one peso

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At the time Argentina launched its new exchange rate scheme, the euro was trading at $0.85. Exporters and importers would be able to convert between dollars and pesos at an exchange rate that was an average of the dollar and the euro exchange rates, that is, P1 = $0.50 + €0.50.

a. How many pesos would an exporter receive for one dollar under the new system?

b. How many dollars would an importer receive for one peso under the new system?

Reference no: EM131277853

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