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Assume that Ford Motor Company outsources production by obtaining some of its parts and components in Mexico. As the peso becomes a larger portion of
Assume that Ford Motor Company outsources production by obtaining some of its parts and components in Mexico. As the peso becomes a larger portion of Ford's total costs, a dollar appreciation leads to a in the peso cost of a Ford vehicle and a in the dollar cost of a Ford compared to the cost changes that occur when all input costs are dollar denominated. larger increase, larger decrease larger increase, smaller decrease O smaller increase, larger decrease O smaller increase, smaller decrease
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