The Law of One Price States That If Transportation Costs

Multiple Choice

The law of one price states that if transportation costs are relatively small, then the:

A) nominal exchange rates for every country's currency must be equal.
B) nominal exchange rate for a currency must equal the real exchange rate for that currency.
C) price of an internationally traded commodity must be the same in all locations.
D) producer with the lowest opportunity cost should be the only producer any commodity.