You own a small record label. You sell CDs through your Web site for $15, including shipping and handling. You get e-mail from someone who owns a record store in Germany who would like to sell your CDs. He wants to buy them at $10 each and sell them for $30. He says his profit from each sale would be $12 and he will split it with you.

Assume the exchange rate between the dollar and the euro is $1 = 2

. If the FX rate between the dollar and the euro falls to $1 = 1, will this still be a good business idea for you? Why or why not?