Figure 19-7 -Refer to Figure 19-7.Which of the Following Is True

Multiple Choice

Figure 19-7
-Refer to Figure 19-7.Which of the following is true?

A) U.S.imports are more expensive at exchange rates greater than $.02/rupee than at the equilibrium exchange rate.
B) The rupee is overvalued at exchange rates less than $.02/rupee.
C) To achieve an exchange rate greater than $.02/rupee,the Reserve Bank of India must buy surplus dollars with rupees.
D) Indian exports to the United States are more expensive at exchange rates greater than $.02/rupee than at the equilibrium exchange rate.