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7. Suppose a new car costs 210,000 Mexican pesos in Mexico, while the same car costs $19,500 in the United States. The nominal exchange rate

7. Suppose a new car costs 210,000 Mexican pesos in Mexico, while the same car costs $19,500 in the United States. The nominal exchange rate is currently at E$/Peso = $.10/Peso. Is the dollar under or overvalued? If so, by how much?

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