1 of 1 International Marketing Incident B: Latin American Debt Crisis In the early 1980s a major debt crisis was widespread throughout Latin America. From the biggest to the smallest economies, countries' foreign debt exceeded their earning power. During this "lost decade" many countries were unable to meet their debt obligations, causing per capita income to drop. Further, poverty levels rose as the gap between the wealthy and poor increased dramatically. The economic and social consequences from the Latin America debt crisis as a whole included the following: Devaluation of currencies, stock markets and asset prices Nominal US dollar GDP of Latin American countries fell drastically Businesses collapsed leading to millions of people falling below the poverty line Intervention of the IMF (International Monetary Fund) for loans and fiscal planning Negative public sentiment that their countries were being controlled by outsiders What if your company had a plant in Mexico that was serving the local Mexican market? Because of the crisis the following changes in demand for Economy SKUs occurred in Mexico: 20% decrease in demand for Large 10% decrease in demand for Medium . 10% increase in demand for Small Specifically as Mexican demand changed, how would this affect your Gross Margins (MXN) in Mexico if you had the following Economy SKUs? Assume per unit costs and prices remain the same