Suppose that the Japanese yen rises against the U.S. dollar-that is, it will tak

Question

Suppose that the Japanese yen rises against the U.S. dollar-that is, it will take more dollars to buy a given amount of Japanese yen. Explain why this increase simultaneously increases the real price of Japanese cars for U.S. consumers and decreases the real price of U.S. automobiles for Japanese consumers. As the value of the yen grows relative to the dollar, the purchase of a Japanese automobile priced in yen requires | dollars, and the purchase of a US automobile priced in dollars requires more fewer

Explanation / Answer

Priced in yen requires More yen,

Fewer yen

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