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The Premium, Breakeven, And Discount Exchange Rates Of The Mexican Peso In The El Paso Retail Sector, Raul Anton Munoz
The Premium, Breakeven, And Discount Exchange Rates Of The Mexican Peso In The El Paso Retail Sector, Raul Anton Munoz
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This paper studies the exchange rates at which Mexican pesos are accepted by different retail sectors in El Paso, Texas. A random sample of 1,155 firms was surveyed to examine two aspects of reverse dollarization in the El Paso/Juarez border region. The first is to determine the percentage of retail businesses in El Paso that accept foreign currency in the form of Mexican pesos. The second is to calculate the effective exchange rate at which firms accept Mexican pesos. Out of 1,155 retail firms surveyed, 586 responses were obtained. The results of this investigation suggest that less than 14 percent …