Multiple Choice
According to purchasing-power parity,if the price of a basket of goods in the U.S.rose from $1,500 to $2,000 and the price of the same basket of goods rose from 600 units of some other country's currency to 1,000 units of that country's currency,then the
A) nominal exchange rate would appreciate.
B) nominal exchange rate would depreciate.
C) real exchange rate would appreciate.
D) real exchange rate would depreciate.
Correct Answer:
Verified
Correct Answer:
Verified
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