In December 1993, one unit of U.S. dollar was worth 5.8 units of the Chinese currency, the Yuan. By January 1994, the ratio had changed to 8.7 to one dollar. Answer the following questions.

a. Did the Yuan depreciate or appreciate in this period? Explain your answer.

b. If a travel agency in China charged 11,600 Yuan for a tour of Beijing and Shanghai in December 1993 (and kept their price constant in 1994), how much would this tour cost in U.S. dollar in January 1994? Show all steps of your calculation.