Which of the following statements is correct, when the exchange rate changes from €2/$ to €1.5/$?
a. Both the euro and the dollar depreciate.
b. The euro (€) depreciates.
c. The euro depreciates and the dollar appreciates.
d. The euro appreciates and the dollar depreciates.
e. None of the above.
.D
You might also like to view...
If a firm buys its labor in a competitive market, then in the short run, a decrease of the demand for the firm's product will cause the firm to
A) offer a higher wage. B) hire fewer workers. C) hire more workers. D) offer a lower wage.
Walter puts money in a savings account at his bank earning 3.5 percent. One year later he takes his money out and notes that while his money was earning interest, prices rose 1.5 percent. Walter earned a nominal interest rate of
a. 3.5 percent and a real interest rate of 5 percent. b. 3.5 percent and a real interest rate of 2 percent. c. 5 percent and a real interest rate of 3.5 percent d. 5 percent and a real interest rate of 2 percent