Which of the following is a transactions account?

According to the purchasing power parity theory, a rise in the United States price level of 5 percent, and a rise in the Mexican price level of 6 percent cause

A) the dollar to appreciate 1 percent relative to the peso. B) the dollar to depreciate 1 percent relative to the peso. C) the dollar to depreciate 5 percent relative to the peso. D) the dollar to appreciate 5 percent relative to the peso.

The price of a good will fall when:

a. there is a shortage of the good. b. there is a surplus of the good. c. demand for the good increases. d. the supply of the good decreases.