1. Explain the effects of the following change in the exchange rate: One year ago $1.00 = 1 Euro; now $1.20 = 1 Euro . Did the dollar become weaker or stronger? Calculate how this change affected the price of U.S. import and exports: A German camera that costs 200 Euros, what will it cost U.S. buyers in dollars? b. When the exchange rate is $1.00 = 1 Euro: _dollars/euros (bold or circle one) C. When the exchange rate is $1.20 = 1 Euro: dollars/euros (bold or circle one) A U.S. computer that cost $600, what will it cost German buyers in Euros? d. When the exchange rate is $1.00 = 1 Euro: _ dollars/euros (bold or circle one) When the exchange rate is $1.20 = 1 Euro: dollars/euros (bold or circle one) f. From this exchange rate change, the quantity of U.S. imports will increase/decrease (bold or circle one) and exports will increase/decrease (bold or circle one) g. Using the GDP equation (algebraically) will this change help grow or shrink (bold or circle one) the U.S. economy? 2. Explain the effects of the following change in the exchange rate: One year ago $1 = 4 yuan; now $1 = 5 yuan a. Did the dollar become weaker or stronger? Calculate how this change affected the price of U.S. import and exports: A Chinese car that costs 200,000 yuan what will it cost U.S. buyers in dollars? b. When $1-4 yuan: _dollars/yuan (bold or circle one) C. When $1 = 5 yuan: dollars/yuan (bold or circle one) A U.S. bushel of rice cost $10, what will it cost Chinese buyers in yuan? d. When $1 = 4 yuan: When $1 = 5 yuan: dollars/yuan (bold or circle one) dollars/yuan (bold or circle one) f. From this exchange rate change, the quantity of U.S. imports will increase/decrease (bold or circle one) and exports will increase/decrease (bold or circle one) g. Using the GDP equation (algebraically) will this change help grow or shrink (bold or circle one) the U.S. economy? 3. The U.S. can produce either 50 tons of rice or 25 tons of steel (or some combination in between) per day. Japan can produce either 20 tons of rice or 20 tons of steel (or some combination in between) per day. a. The U.S. has an absolute advantage at producing which product(s)? b. The U.S. has a comparative advantage at producing which product(s)? Explain why using opportunity costs. c. Japan has an absolute advantage at producing which product(s)? d. Japan has a comparative advantage at producing which product(s)? Explain why using opportunity costs. e. For each country to be better off Japan should produce only_ and the U.S. should produce only produce. Why? and then they should trade for what they don't