Which of the Following Events Will Cause the Largest Real

Multiple Choice

Which of the following events will cause the largest real depreciation for the domestic economy?

A) A 7% decrease in E and a 7% decrease in P*.
B) A 3% increase in E and a 3% increase in P.
C) A 7% increase in P and a 7% decrease in P*.
D) A 7% decrease in E and a 7% increase in P*.
E) A 4% increase in E.