If the dollar-peso exchange rate is 0.01 dollars per peso, what is the rate of pesos per dollar?
a. 1 peso/dollar
b. 10 pesos/dollar
c. 0.1 peso/dollar
d. 1,000 pesos/dollar
e. 100 pesos/dollar
E
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Political tensions may arise from nations pegging to a center base country's currency if:
A) asymmetric shocks cause the home nation to lose the power to stabilize. B) it is determined that the center nation has been misrepresenting the value of its currency. C) financing of military spending becomes more difficult. D) interest rates are affected.
The investment schedule is downward sloping and the saving schedule is upward sloping with respect to the interest rate. Suppose the equilibrium real investment per year at the market rate of interest is $1 trillion
How is this represented when real national income per year is on the horizontal axis? How is this incorporated into the consumption-function graph?