The price of a basket of goods and services in the U.S. is $600 . In Canada the same basket of goods costs 700 Canadian dollars. If the nominal exchange rate were 1.2 Canadian dollars per U.S. dollar, what would be the real exchange rate?
a. 700/600
b. 600/700
c. 700/720
d. None of the above is correct.
d
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In the figure above, suppose the original budget line is BD. A fall in the price of a compact disc will
A) rotate the budget line to AD. B) rotate the budget line to CD. C) not move the budget line. D) result in a parallel leftward shift of the budget line.
Potential GDP is defined as
A) the amount of GDP produced if there is no structural unemployment. B) the level of GDP attained when all firms are producing at capacity. C) the maximum of GDP that the economy can produce. D) the amount of GDP produced if there is no frictional unemployment.
(Consider This) In 2013, McDonald's introduced Fish McBites, which failed to catch on with the public and was subsequently dropped from the menu. This failure illustrates the idea of
What will be an ideal response?
A surplus exists
A. when quantity supplied is greater than quantity demanded. B. in equilibrium. C. when quantity supplied is less that quantity demanded. D. at the market clearing price.