I need explanations

Problem 6.6 Corolla Exports and Pass-Through Assume that the export price of a Toyota Corolla from Osaka, Japan is 42,150,000. The exchange rate is 87.60/$. The forecast rate of inflation in the United States is 2.2% per year and is 0.0% per year in Japan. Use this data to answer the following questions on exchange rate pass through. a. What was the export price for the Corolla at the beginning of the year expressed in U.S. dollars? b. Assuming purchasing power parity holds, what should the exchange rate be at the end of the year? c. Assuming 100% pass-through of exchange rate, what will the dollar price of a Corolla be at the end of the year? d. Assuming 75% pass-through, what will the dollar price of a Corolla be at the end of the year? Steps Initial spot exchange rate(\/$) Initial price of a Toyota Corola () Expected US dollar inflation rate for the coming year Expected Japanese yen inflation rate for the coming year Desired rate of pass through by Toyota Value 87.60 2,150,000 2.200% 0.000% 75.000% a. What was the export price for the Corolla at the beginning of the year? Year-beginning price of an Corolla () Spot exchange rate (/$) Year-beginning price of a Corolla ($) 2,150,000 87.60 24,543.38 $ b. What is the expected spot rate at the end of the year assuming PPP? Initial spot rate (/$) Expected US$ inflation Expected Japanese yen inflation Expected spot rate at end of year assuming PPP (/$) 87.60 2.20% 0.00% 85.71 2,150,000 c. Assuming complete pass through, what will the price be in USS in one year? Price of Corolla at beginning of year () Japanese yen inflation over the year Price of Corolla at end of year () Expected spot rate one year from now assuming PPP (/$) Price of Corolla at end of year in ($) 0.000%) 2,150,000 85.71 25,083.33 S d. Assuming partial pass through, what will the price be in US$ in one year? Price of Corolla at end of year () Amount of expected exchange rate change, in percent (from PPP) Proportion of exchange rate change passed through by Toyota 2,150000 Proportional percentage change 86.178 Effective exchange rate used by Toyota to price in US$ for end of year Price of Toyota at end of year ($) $ 2,150,000 2.200% 75.000% 1.650% 86.178 24,948.34 Problem 6.6 Corolla Exports and Pass-Through Assume that the export price of a Toyota Corolla from Osaka, Japan is 42,150,000. The exchange rate is 87.60/$. The forecast rate of inflation in the United States is 2.2% per year and is 0.0% per year in Japan. Use this data to answer the following questions on exchange rate pass through. a. What was the export price for the Corolla at the beginning of the year expressed in U.S. dollars? b. Assuming purchasing power parity holds, what should the exchange rate be at the end of the year? c. Assuming 100% pass-through of exchange rate, what will the dollar price of a Corolla be at the end of the year? d. Assuming 75% pass-through, what will the dollar price of a Corolla be at the end of the year? Steps Initial spot exchange rate(\/$) Initial price of a Toyota Corola () Expected US dollar inflation rate for the coming year Expected Japanese yen inflation rate for the coming year Desired rate of pass through by Toyota Value 87.60 2,150,000 2.200% 0.000% 75.000% a. What was the export price for the Corolla at the beginning of the year? Year-beginning price of an Corolla () Spot exchange rate (/$) Year-beginning price of a Corolla ($) 2,150,000 87.60 24,543.38 $ b. What is the expected spot rate at the end of the year assuming PPP? Initial spot rate (/$) Expected US$ inflation Expected Japanese yen inflation Expected spot rate at end of year assuming PPP (/$) 87.60 2.20% 0.00% 85.71 2,150,000 c. Assuming complete pass through, what will the price be in USS in one year? Price of Corolla at beginning of year () Japanese yen inflation over the year Price of Corolla at end of year () Expected spot rate one year from now assuming PPP (/$) Price of Corolla at end of year in ($) 0.000%) 2,150,000 85.71 25,083.33 S d. Assuming partial pass through, what will the price be in US$ in one year? Price of Corolla at end of year () Amount of expected exchange rate change, in percent (from PPP) Proportion of exchange rate change passed through by Toyota 2,150000 Proportional percentage change 86.178 Effective exchange rate used by Toyota to price in US$ for end of year Price of Toyota at end of year ($) $ 2,150,000 2.200% 75.000% 1.650% 86.178 24,948.34