Final answer:
The direct quote from the U.S. perspective given the current exchange rate of €0.80 = $1.00 is €0.80 = $1.00option 3. This highlights how exchange rate fluctuations, such as the change of the euro from $1.06/euro in 1999 to $1.37/euro in 2013, significantly affect international business and trade, impacting profits and losses.
Step-by-step explanation:
If the current exchange rate is €0.80 = $1.00, the direct quote from the U.S. perspective is option 3) €0.80 = $1.00. This means that for every 1 U.S. dollar, you can exchange it for 0.80 euros. This direct exchange rate format is stating the amount of foreign currency that can be obtained with one unit of domestic currency.
For instance, in 1999 when the euro first became a currency, its value measured in U.S. currency was $1.06/euro. A French firm converting $10 million back to euros would receive €9.4 million at this rate, suffering a loss against their costs of €10 million. As the euro strengthened to $1.37/euro by 2013, the firm received only about €7.3 million for the same $10 million, increasing their loss due to the stronger euro and weaker U.S. dollar. This example demonstrates how fluctuating exchange rates can impact international business transactions and profitability.