Topic 12: Pizza for Pesos?

The pizza store is accepting pesos because it is related to utility. The utility for the buyer to buy pizza increase if they can pay pesos instead of U.S. dollar, this is because that most of the buyers who pay pesos are Mexican which they don’t have U.S. dollar. This is meaning that if the pizza store doesn’t allow them to pay with pesos, many buyers will not buy it because they don’t have U.S. dollar and is not convenient. This is also related to consumer preference, the Mexican will be more willing to pay for pizza with pesos instead of U.S. dollar because that’s their money. They will think that is not convenient to change their money to U.S. dollar. The exchange rate can cause Pizza Patron to either lose money or gain money base on the exchange rate between U.S. dollar and pesos. If pesos money is good at a certain time, Pizza Patron will earn a little bit more than usual because they can exchange more U.S. dollar with pesos compare to usual. The budget line will be affect and shift the curve either right or left depend on the exchange rate. I think accepting pesos is a good choice because first, it can increase the utility for Mexican to buy pizza from them and the income might be greater if the exchange rate is good.