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A weaker rupee and an importer's margin
The prompt
A fictional Indian company imports wireless speakers and sells them in India. Each speaker costs USD 100 to buy. The exchange rate has been 85 rupees per dollar, and the rupee then weakens so that a dollar costs 10 percent more rupees. Each speaker sells for INR 12,000 and carries INR 1,500 of local costs (duty, freight, store and staff). All numbers are illustrative. What happens to profit per speaker, and what price would keep the rupee profit the same?
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