Question

Suppose a u.s.-made machine costs $500 and the exchange rate is 100 yen = $1. a japanese citizen purchasing this machine would pay:

Answer 1

When a machine is in US dollar and a Japanese needs to pay in Yen, the amount should be converted into Yen.

A US Made machine cost $500

Exchange rate : 100 Yen = $1

In order to purchase the machine, a Japanese needs to pay:

= Cost of the machine in dollars × Yen per dollar

= $500 × 100

= 50,000 yen

Therefore, a machine of $500 will cost a Japanese in 50,000 Yen.