You are living in Indonesia in early 1998. The country is experiencing a financial and exchange-rate crisis. When you arrived late last year, the exchange rate was 3,000 rupiah per dollar . Today, the exchange rate is 12,000 rupiah per dollar. The price of food is much more expensive; however, you notice that the prices of electronics haven’t changed much. You are looking to buy a small television priced at 240,000 rupiah . At the current rate, you can purchase the television for the equivalent of $20. You continue to be paid in U.S. dollars. Should you take advantage of this situation?

1. From an economics perspective, if a buyer and seller are willing and able to transact at a certain price, there are welfare gains to the transaction.

2. “’It’s no good, it’s no good!’ says the buyer—then goes off and boasts about the purchase.”