Initially the nominal exchange rate between the South Korean won and the U.S. dollar is 950 won per dollar. If the nominal exchange rate increases to 1000 won per dollar and the U.S and Korean price levels do not change, the real exchange rate
A) is the same as before.
B) is greater than before.
C) is less than before.
D) More information is needed to answer the question.
B
Economics
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Investment occurs when:
a. firms are very profitable and have lots of extra cash on hand. b. there is a reduction in risk-aversion. c. the expected real interest rate is less than the expected real return on the investment project. d. individuals realize that there are greater long-term gains in the equity and credit markets.
Economics
If labor supply is increasing in the real wage, then
A) the substitution effect is larger than the income effect. B) the income effect is larger than the substitution effect. C) the production function is increasing in labor. D) the marginal product of labor is decreasing.
Economics