Suppose that over the past decade, U.S. inflation is greater than that in Mexico. Further assume that during this same period, the dollar appreciates relative to the Mexican peso. Given this information,
A) the real exchange rate remains unchanged.
B) the real exchange rate must decrease.
C) the real exchange rate must increase.
D) the real exchange rate can increase or remain the same, but not decrease.
E) the real exchange rate can decrease or remain the same, but not increase.
C
Economics
You might also like to view...
There is a technological advance in the production of digital watches. This will cause:
a. demand to increase. b. supply to increase. c. demand to decrease. d. supply to decrease. e. the price to increase.
Economics
In 2013, new stock sales accounted for ____ in corporate financing because corporations bought back some of their stock
a. $2 billion b. -$384 billion c. $1 trillion d. ?$65 billion
Economics