The Real Exchange Rate Can Be Decomposed into Two Parts,the

Multiple Choice

The real exchange rate can be decomposed into two parts,the __________ and the __________.

A) nominal exchange rate;ratio of the domestic price level to the world price level
B) nominal exchange rate;the difference between the domestic and foreign interest rate
C) interest rate differential;the difference between the domestic and foreign inflation rate
D) nominal exchange rate;ratio of the price of exported goods to imported goods
E) interest rate differential;ratio of the domestic price level to the world price level