Multiple Choice
According to purchasing-power parity,if the price of a basket of goods in the U.S.rose from $2,000 to $2,104 and the price of the same basket of goods rose from 800 units to 832 units of some other 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
Q31: A basket of goods cost $800 in
Q32: If the dollar buys fewer bananas in
Q33: A Big Mac in Japan costs 400
Q34: An MP3 player in Singapore costs 200
Q35: If purchasing-power parity holds,then the value of
Q37: The nominal exchange rate is about 2
Q38: If P = domestic prices,P* = foreign
Q39: The ability to profit by purchasing wheat
Q40: Suppose a McDonalds Big Mac costs $4.40
Q41: According to purchasing-power parity,if the Federal Reserve