QUESTION 13.3 Suppose you own a car assembly line in Mexico. The different parts of the car are imported from the United States and the assembled cars are exported back to the United States.

13.3A What happens to the price of the imports when the Mexican peso depreciates? 13.3B Does your car become more or less attractive to US consumers when the Mexican peso depreciates? Explain.

13.3C As a Mexican producer, do you think the depreciation of the Mexican peso is a good thing?