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post explanation please! Dell is selling 20,000 units in Europe at an average price of 1,700 per unit. Both the spot and forward exchange rates
post explanation please!
Dell is selling 20,000 units in Europe at an average price of 1,700 per unit. Both the spot and forward exchange rates are $1.20/. The cost of each unit in dollars is $1,500 per unit. The elasticity of demand for Dell computers in Europe is -1.5. Reconsider a depreciation of Euro (relative to US dollar) from $1.20/ to $1.08/. Now assume passthrough - 0.5. What is Dell's total profit in $? $11,869,440 $8,028,860 $12,028,410 $6,397,440Step by Step Solution
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