Suppose that a Toyota Camry costs $25,000 in the U.S. and 20,000 in Europe, while the nominal dollar-euro exchange rate is 0.9
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Question 1€ 0.90 equivalent€ 20,000.00 equivalent BuySellProfit from each car $1$22,222.22 $22,222.22$25,000$2,777.78 Question 2 equilibrium nominal exchange rate equilibrium rate 0.90…