Porsche plans on introducing a new four-door luxury automobile in 2009 called the Panamera. Although pricing is not yet set, some automotive analysts believe the basic production model will be sold in Europe at a price of 120,000. At this price they believed the company stood to earn a 20% margin on each car.

If the spot rate in 2009 was $1.44/, what would be its projected price in the United States?

If the price in the U.S. market was set at $158,000, and the spot exchange rate averaged $1.4240/, what would be the margin on the Panamera?

Using the same basic data as in the previous problem, consider the following. If the dollar continues to fall throughout the year, and the spot rate in 2009 averages $1.6250/, but the U.S. dollar price is held constant since its introduction in January 2009 at $158,000, what would be the profit margin on each car sold in the U.S.?