U.S. car manufacturer Ford exports Mustangs (a Ford model) to the U.K. Currently, they export 15,000 units, selling each one for 38,000 British pounds (GBP). It costs $22,000 to manufacture each Mustang in the U.S. Ford was forecasting an exchange rate of $1.40 per GBP but the actual spot exchange rate today is $1.31 per GBP. Answer the following questions, showing your work:

a) what is Ford's current level of profitability, at the actual spot rate?

b) is the current level of profitability higher or lower than expected?

c) based on your answer to b, what would you recommend Ford do to increase their export profits?