A widget costs $1000 in the US and CAD$1200 in Canada. The current exchange rate is 1USD=1.09CAD. Given purchasing power parity, the Canadian dollar would_______to equilibrate prices
a. Appreciate
b. Depreciate
c. Not change
d. None of the above
b
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A rise in the price level because of an increase in the money wage rate
A. definitely triggers a cost-push inflation B. definitely triggers a demand-pull inflation C. might trigger a cost-push inflation D. might trigger a demand-pull inflation.
Suppose the president of a college argues that a 25 percent tuition increase will raise revenues for the college. It can be concluded that the president thinks that demand to attend this college is:
A. elastic. B. inelastic, but not perfectly inelastic. C. unitary elastic. D. perfectly elastic.
Suppose Sam plans to buy only popcorn and soda. He has $40 to spend per week. A change in which of the following variables will change Sam's consumption possibilities? I. price of popcorn II. income III. preferences IV. utility
A) II only B) I and II C) I, II and III D) III and IV
Refer to the figure above. If A imposes a per unit tariff of $10 on imports from both B and C, it will import
A) 400 units from B. B) 200 units from C. C) 200 units from each. D) 400 units from B and 200 units from C.