please also draw graph

Back to Assignment Attempts Average / 2 5. Exchange-rate overshooting The following graph shows the short-run supply schedule (So) and demand schedule (Do) for the Mexican peso. S, denotes the long-run supply schedule of pesos. The initial equilibrium exchange rate is $1.80 per peso. Suppose that the demand for pesos decreases to D1. On the graph, use the tan point (dash symbol) to indicate the short-run equilibrium exchange rate. Then use the grey point (star symbol) to indicate the long-run equilibrium exchange rate. Note: Dashed drop lines will automatically extend to both axes. So Short-Run Equilibrium On the graph, use the tan point (dash symbol) to indicate the short-run equilibrium exchange rate. Then use the grey point (star symb the long-run equilibrium exchange rate. Note: Dashed drop lines will automatically extend to both axes. (?) 3.0 2.7 So Short-Run Equilibrium 2.4 N S. Long-Run Equilibrium EXCHANGE RATE (Dollars per peso) 0.6 0.3 Do O 20 40 60 80 100 120 140 160 180 200 QUANTITY (Pesos) D1 20 40 60 100 120 140 160 180 200 QUANTITY (Pesos) The quantity of pesos supplied decreases. The dollar appreciates to $0.90 per peso. The Mexican price of U.S. exports increases, and the quantity of U.S. exports demanded decreases. Referring that led to the long-run equilibrium The supply schedule of pesos becomes more elastic, as shown by S,. exchange The dollar depreciates to $1.50 per peso. Step 1. 2. 4. 5 Grade It Now Save & Continue Continue without saving