Consider an Identical Basket of Goods in Both the U

Multiple Choice

Consider an identical basket of goods in both the U.S. and India. For a given nominal exchange rate, in which case is it certain that the U.S. real exchange rate with India falls?

A) the price of the basket of goods rises in the U.S. and India.
B) the price of the basket of goods rises in the U.S. and falls in India.
C) the price of the basket of goods falls in the U.S. and rises in India.
D) the price of the basket of goods falls in both India and the U.S..