A Cadbury chocolate bar made in the U.K. costs one pound while a Hershey's chocolate bar made in the U.S. costs one dollar. Calculate the cost of the Cadbury bar in dollars when the exchange rate, E$₤ = 1.1? When E$₤ = 1.25? answers in the table below.

b. Calculate the cost of the Hershey's chocolate bar in British pounds when the exchange rate, E$₤ = 1.1? When E$₤ = 1.25? Exchange Rate Cost of Cadbury bar Cost of Hershey bar E$₤ Dollars Pounds Dollars Pounds 1.1 1.25?

c. What effect will an increase in the exchange rate (E$₤) have on U.S. purchases of Cadbury bars? Why? What effect will it have on British purchases of Hershey bars? Why?

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b To calculate the cost of the Cadbury bar in dollars we need to divide the cost in ... View the full answer