1. Suppose the exchange rate at the start of the year was .6525/$. Since the start of the year, the pound has appreciated 6%. What is the exchange rate today? Keep the $ as the base currency and the as the terms currency. (4 decimal places like the original exchange rate)

2. If the U.S. dollar appreciates relative to the MXN (Mexican peso) over time, the dollar cost to a U.S. firm that buys products produced in Mexico and pays in MXN will _____ _____________ over time. (Answer either be rising or be falling)