Solved: What is the change in homes external wealth in pesos, Macroeconomics

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What is the change in homes external wealth in pesos

Problem

Home's currency is the peso and trades at 1 peso per dollar. Home has external assets of $200 billion, all of which are denominated in dollars. It has external liabilities of $400 billion, 75% of which are denominated in dollars.

a. Is Home a net creditor or debtor? What is Home's external wealth?

b. What is Home's net position in dollar denominated assets?

c. If the peso depreciates to 1.2 pesos per dollar, what is the change in Home's external wealth in pesos?

The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.

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