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Question 2 (15 points) Assume Isuzu produces a car in Japan for 1.8 million. On June 1, when new models are introduced, the exchange rate

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Question 2 (15 points) Assume Isuzu produces a car in Japan for 1.8 million. On June 1, when new models are introduced, the exchange rate is \150/USD. Consequently, the automaker sets the sticker price for the car at USD 12,000. By August 1, the exchange rate has dropped to 125/USD. Isuzu is worried that it will receive fewer Yen sale ($12,000 ~ 125 = 1.5 million). per (a) What scenario(s) could explain the trajectory of the exchange rate? (3 points; 150 words)

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