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If we are transportation costs and the price of a pair of Nike shoes in Detroit's 100 US dollars, what should be the price of the Nike shoes in Windsor, Canada (in Canadian dollars) it the nominal exchange rate is 1.36 Canadian dollars US dollar?

a. 74
b. 136
c. 100
d. 64

User Nat Kuhn
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1 Answer

2 votes

Final answer:

The price of the pair of Nike shoes in Windsor, Canada should be b. $136 Canadian dollars given the nominal exchange rate of 1.36 Canadian dollars per US dollar.

Step-by-step explanation:

The student has asked about the price adjustment of a product when considering the nominal exchange rate between two currencies. To find the price of Nike shoes in Windsor, Canada, given that the price in Detroit, USA, is $100 and the nominal exchange rate is 1.36 Canadian dollars for 1 US dollar, we multiply the US price by the exchange rate:

Price in Canada = $100 (price in US) × 1.36 (exchange rate) = $136 Canadian dollars.

Therefore, the price of the pair of Nike shoes in Windsor, Canada, in Canadian dollars should be 136, which corresponds to option b.

User Zachary Newman
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