A US based computer manufacture produces and sells laptops in South America through two manufacturing facilities: one in Argentina and the other in Brazil. The following applies:

	Argentina	Brazil
Investment price	200 million US$	200 million US$
Cost per Laptop	900 pesos	600 reals
Price per Laptop	1200 pesos	800 reals
Projected Annual Earnings	150 million pesos	100 million reals
Exchange Rate	Pesos 3 / US$	Reals 2/US$

If Brazil real depreciates 20% against the US$, what is the new pesos/real exchange rate?

		1.2
		1.25
		1.88
		1.9