Multiple Choice
Suppose the nominal exchange rate is 95 yen/dollar, the price of beef in Japan is ¥1200, and the price of beef in Canada is $12. Using the purchasing-power parity theory, approximately how much should you expect the exchange rate to change by?
A) -12.6 yen/dollar
B) -5 yen/dollar
C) 5 yen/dollar
D) 12.6 yen/dollar
Correct Answer:
Verified
Correct Answer:
Verified
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