Assume the Chilean peso is decreasing in exchange value compared to the U.S. dollar. Who will benefit most in this situation?
A Chilean company that imports oil from Venezuela
A Chilean family visiting relatives in the United States
A Chilean exporter who sells fruits and vegetables to the U.S.***
A Chilean importer who brings American cars to Chile
I think its C
:) good job.
In this situation, a Chilean exporter who sells fruits and vegetables to the U.S. will benefit the most.
Explanation:
When the Chilean peso decreases in exchange value compared to the U.S. dollar, it means that it takes more Chilean pesos to buy a U.S. dollar. As a result, Chilean exporters who sell products to the U.S. will receive more Chilean pesos when they convert their U.S. dollar earnings back into the domestic currency. This means they will get a higher return on their exports and increase their profits.
On the other hand, the other options may not benefit as much in this situation.
- A Chilean company that imports oil from Venezuela: If the Chilean peso is decreasing, it means that it will take more Chilean pesos to buy the same amount of U.S. dollars needed to purchase oil from Venezuela. This can increase the costs for the company, making it less beneficial for them.
- A Chilean family visiting relatives in the United States: Since the Chilean peso is decreasing in value, it means that the Chilean family will need to exchange more Chilean pesos to obtain the same amount of U.S. dollars for their expenses in the United States. This can make their trip more expensive.
- A Chilean importer who brings American cars to Chile: Similarly, if the Chilean peso is decreasing, it means that the Chilean importer will need to exchange more Chilean pesos for the same amount of U.S. dollars needed to import American cars. This can increase their costs and potentially decrease their profits.