Question

Louis owns an import business. After traveling to France on numerous occasions, he developed a taste for fine French wines. A radio report that he heard this morning indicated that the dollar has fallen sharply against the euro. Based on this information, Louis expects that: A. American goods will become more expensive in France. B. French wines will become more expensive in the United States. C. French wines will become less expensive in the United States. D. the French government will place an embargo on American exports.

Answer 1

Answer:

B) French wines will become more expensive in the United States.

Explanation:

When rate of dollar falls to that of euro, the same number of dollars will purchase fewer French goods, so French goods become more expensive to American consumers. If one travels to Europe (including France), one will exchange one dollar for less than one euro