The ECU as a basket of currencies. What is the percentage/weight of the ECU’s total value accounted by the Spanish peseta? Refer to Exhibit 3. 4 in the text.

Would you get a different result if you valued the ECU in Japanese yen instead of the U.S. dollar? Would you expect this weight to change if the ECU depreciates by 10 percent against the U.S. dollar?

Data from Exhibit 3.4

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Amount of Each Currency in Currency One ECU (1) EXHIBIT 3.4 What Is an ECU, and How Much Is It Worth in Dollars as of January 10, 1991? Component in Weight of Each Currency in the ECU (4) Exchange Rate of the Value of the Currency i's ECU Currency in Dollars (2) $ (3)=(1) x (2) German mark (DM) 0.6242 0.6607 0.4127 30.8 French franc (FF) 1.332 0.1942 0.2587 19.3 British pound () 0.08784 1.90250 0.1671 12.5 Italian lira (IL) 151.8 0.000877 0.1331 9.9 Dutch guilder (DG) 0.2198 0.5848 0.1285 9.6 Belgian franc (BF) 3.301 0.032 0.1056 7.9 Luxembourg franc (LF) 0.130 0.0167 0.0021 0.2 Spanish peseta (Pta) 6.885 0.0104 0.0716 5.4 Danish krone (DK) 0.1976 0.1711 0.0338 2.5 Irish pound (IE) 0.008552 1.7415 0.0148 1.1 Greek drachma (GD) 1.440 0.00328 0.0047 0.4 Portuguese escudo (Esc) 1.393 0.00384 0.0053 0.4 1.3380 100.0 The currency composition of the ECU was valid from September 21, 1989, until the launch of the euro on January 1, 1999.