Linear Algebra and Its Applications (5th Edition)

Published by Pearson
ISBN 10: 032198238X
ISBN 13: 978-0-32198-238-4

Chapter 1 - Linear Equations in Linear Algebra - 1.6 Exercises - Page 55: 4

Answer

The problem does not change if we consider other currency instead if US dollar.

Work Step by Step

According to the previous problem the ratio between the price of goods $\left(P_{G}\right)$ and the price of services $\left(P_{S}\right)$ is $P_{G}=\frac{7}{8} P_{S}$ This means that for each value of $P_{S}$ we obtain a $P_{G}$ which satisfies the problem needs. Let the prices are in US dollars and the exchange rate between Japanese yen and US dollars is $y e n=r \cdot d o l l a r,$ where $r \in \mathbb{R}, r>0$ than the new prices are: $J P_{G}=r \cdot P_{G}$ and $J P_{S}=r \cdot P_{S}$ 2 So we note\pi in that by multiplying $P_{G}=\frac{7}{8} P_{S}$ by $r$ on both sides we obtain $r \cdot P_{G}=r \cdot P_{S} \frac{7}{8}$ which is equivalent with $J P_{G}=\frac{7}{8} J P_{S}$ 3 This is why we can conclude that regardless of currency the ratio between the price of good and the price of services remains constant.
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