5.2.1 State the country with the smallest range between the imports and exports to Brazil. 5.2.2 Identify the weakest currency against the Brazilian real. 5.2.3 Calculate the excha... 5.2.1 State the country with the smallest range between the imports and exports to Brazil. 5.2.2 Identify the weakest currency against the Brazilian real. 5.2.3 Calculate the exchange rate between the euro and the South African rand in the form €1 = R... 5.2.4 Ludwig, a German citizen, stated that the difference between the United States imports and exports to Brazil is more than 7 600 million euros. Verify, showing ALL calculations, whether Ludwig's statement is VALID.
Understand the Problem
This problem involves analyzing trade data between Brazil and other countries, as well as currency exchange rates. The questions require you to: identify the country with the smallest import/export range, determine the weakest currency against the Brazilian real, calculate the exchange rate between the Euro and South African Rand, and verify a statement about the difference between US imports and exports to Brazil in Euros.
Answer
5.2.1 Japan 5.2.2 South African Rand 5.2.3 €1 = R16.78 5.2.4 VALID
Answer for screen readers
5.2.1 Japan 5.2.2 South African Rand 5.2.3 €1 = R16.78 5.2.4 Ludwig's statement is VALID.
Steps to Solve
- Find the country with the smallest import/export range Calculate the difference between exports and imports for each country and identify the smallest difference.
China: $67.79 - 36.74 = 31.05$ United States of America: $29.72 - 21.62 = 8.10$ Germany: $9.68 - 4.12 = 5.56$ Argentina: $8.49 - 8.22 = 0.27$ South Korea: $4.66 - 3.76 = 0.90$ Japan: $4.32 - 4.13 = 0.19$ The smallest range is $0.19$ billion US$, which corresponds to Japan.
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Identify the weakest currency against the Brazilian Real Compare the exchange rates to determine which currency buys the least amount of Brazilian Real. US$1 = BRL4.9642 €1 = BRL5.2379 1BRL = R3.2026 which also means R3.2026 = 1BRL. Therefore, R1 = 1/3.2026 BRL = BRL0.3122 Since 1 US$ = BRL4.9642, 1 Euro = BRL5.2379 and 1 Rand = BRL0.3122. The weakest currency is the South African Rand, as it buys the least amount of Brazilian Real.
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Calculate the exchange rate between the Euro and South African Rand We know that €1 = BRL5.2379 and 1BRL = R3.2026. Therefore, €1 = BRL5.2379 = $5.2379 \times R3.2026 = R16.7759$. Rounding to two decimal places, €1 = R16.78.
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Verify Ludwig's statement Calculate the difference between US imports and exports to Brazil in US dollars: $29.72 - 21.62 = 8.10$ billion US$. Convert this difference to Euros: $8.10 \text{ billion US$} \times \frac{\text{BRL}4.9642}{1 \text{ US$}} \times \frac{1 \text{ Euro}}{\text{BRL}5.2379} = 8.10 \times \frac{4.9642}{5.2379} \text{ billion Euros} = 8.10 \times 0.9477 \text{ billion Euros}= 7.676 \text{ billion Euros}= 7676 \text{ million Euros}$. Compare this value to Ludwig's statement: Is $7676 \text{ million Euros} > 7600 \text{ million Euros}$? Yes, Ludwig's statement is VALID.
5.2.1 Japan 5.2.2 South African Rand 5.2.3 €1 = R16.78 5.2.4 Ludwig's statement is VALID.
More Information
The Euro is stronger than the US dollar and the Brazilian real (BRL). The South African Rand is significantly weaker than all three currencies.
Tips
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