Essay
The nominal exchange rate is 15 crowns per florin,the domestic price level is 6 florins/bottle,and the foreign price level is 2 crowns/bushel.
(a)What is the real exchange rate?
(b)What is the real exchange rate in the foreign country?
(c)If the domestic price level rises to 8 florins/bottle,what must the nominal exchange rate become if the real exchange rate remains unchanged?
Correct Answer:
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(a)45 bushels/bottle...View Answer
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Correct Answer:
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