(2) The cart below shows the nominal exchange rates between the argentine peso and the dollar and the Brazilian real and the dollar. (1) (5 pts) Do you think that the Argentine peso has appreciated or depreciated again the Brazilian real? Justify. (ii) (5 pts) What do you think would more likely happen to the trade balance between Argentina and Brazil in the last year? Justfy Solution i) The argentio peso has dereciated against the Brazilian real because now more units of Argentine Peso is required to buy the same units of Brazilian Real ii) Exports from Argentina to Brazil will increase as the argentio peso has dereciated against the Brazilian real which will lead to exporters earning more money. However, the imports from Brazil will decrease as products will become more expensive to buy.