Question

Ou’re shopping for a jacket online and find one you like for €110.50 Euro, which is

equal to $125 U.S.
a. What is worth more, $1 U.S. or €1 Euro? Explain.
b. Fill in the blanks. Show how you arrive at your answers.
$1 U.S. ≈ €____________________ Euro €1 Euro ≈ $____________________ U.S.
c. You see the same jacket on another site for ₱ 2,000 Mexican Pesos. Use the fact that $1
U.S. is about ₱ 20.66 Mexican Pesos to determine whether this is cheaper than $125 U.S.
Show how you arrive at your answer.
7. The current average cost of gas in Italy is €1.726 Euro per liter. What is this cost in
U.S. Dollars per gallon? Use your answer to Problem #6b and the fact that there are
about 0.26 gallons in 1 liter.
75

Answer 1

a. To determine which is worth more, we need to compare the exchange rates. If €1 Euro is worth more than $1 U.S., then the Euro is worth more. If $1 U.S. is worth more than €1 Euro, then the dollar is worth more. As of the given exchange rate, €1 Euro is worth less than $1 U.S., so $1 U.S. is worth more.

b. To fill in the blanks, we can use the given exchange rate of €110.50 Euro = $125 U.S.:

$1 U.S. ≈ €0.884 Euro

€1 Euro ≈ $1.129 U.S.

c. To determine if ₱ 2,000 Mexican Pesos is cheaper than $125 U.S., we need to convert the price in Mexican Pesos to U.S. dollars. We can use the exchange rate provided:

$1 U.S. ≈ ₱20.66 Mexican Pesos

So, ₱ 2,000 Mexican Pesos is:

₱ 2,000 / ₱20.66/$1 U.S. = $96.89 U.S.

Since $96.89 U.S. is less than $125 U.S., the jacket on the other site is cheaper.

d. To determine the cost of gas in U.S. dollars per gallon, we need to convert the cost in Euros per liter to U.S. dollars per gallon. We can use the exchange rate:

$1 U.S. ≈ €0.884 Euro

There are 0.26 gallons in 1 liter, so we can convert the cost per liter to cost per gallon:

€1.726 Euro / 1 liter * $1 U.S. / €0.884 Euro * 0.26 gallons / 1 liter = $8.12 U.S. per gallon

Therefore, the cost of gas in Italy is about $8.12 U.S. per gallon.

Answer 2

a. At the current exchange rate, €1 Euro is worth more than $1 U.S. This is because 1 Euro is equivalent to $1.13 U.S. (as given in the problem), which means that for every one dollar, you would receive less than one Euro in exchange. Therefore, €1 Euro is worth more than $1 U.S.

b. To fill in the blanks, we need to use the given conversion rate of €1 Euro = $1.13 U.S. and reciprocate it to find $1 U.S. ≈ €0.885 Euro. Using this conversion rate, we can find that:

$1 U.S. ≈ €0.885 Euro
€1 Euro ≈ $1.13 U.S.

c. To determine whether the jacket is cheaper when priced in Mexican Pesos, we need to convert the price to U.S. dollars using the given exchange rate of $1 U.S. = ₱20.66 Mexican Pesos.

The price of the jacket in Mexican Pesos is ₱2,000. To convert this to U.S. dollars, we divide by the exchange rate:

₱2,000 ÷ 20.66 = $96.89 U.S.

Since $96.89 U.S. is less than $125 U.S. (the price of the jacket in the first website), the jacket priced in Mexican Pesos is cheaper.

7. To convert from Euro per liter to U.S. Dollars per gallon, we need to use the conversion factors from Problem 6b and the fact that there are approximately 3.785 liters in one gallon. First, we can convert from Euro per liter to U.S. dollars per liter by multiplying the cost in Euro per liter by the conversion rate:

€1.726 Euro/L × $1.13 U.S./€1 Euro ≈ $1.95 U.S./L

Then, we can convert from US dollars per liter to U.S. dollars per gallon:

$1.95 U.S./L ÷ 3.785 L/gallon ≈ $0.52 U.S./gallon

Therefore, the cost of gas in Italy is approximately $0.52 U.S. per gallon.