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If the USprice Level Is Increasing by 3 Percent Annually and the and the Japanese

Question 77

Multiple Choice

If the U.S.price level is increasing by 3 percent annually and the Japanese price level is increasing by 1 percent annually,then according to purchasing-power parity,by about what percent would the nominal exchange rate be changing?


A) decreasing by 4 percent
B) decreasing by 2 percent
C) increasing by 4 percent
D) increasing by 2 percent

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