There is a flexible exchange rate system and only two countries in the world, the United States and Mexico. The real interest rate in the United States rises relative to the real interest rate in Mexico. It follows that
A) the dollar will depreciate and the peso will appreciate.
B) the peso will depreciate and the dollar will appreciate.
C) both the peso and the dollar are likely to appreciate.
D) both the peso and the dollar are likely to depreciate.
B
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The manner in which a nation's economy reacts when the measured factors are changed affects almost every individual
Indicate whether the statement is true or false
More recently, the velocity of money was:
A. higher during the housing boom and lower during the recession that followed. B. lower during the housing boom and higher during the recession that followed. C. consistently higher than the historical trend since the mid-1980s. D. consistently lower than the historical trend since the early 1990s.
The opportunity cost to you of an action is
a. how much you must pay for the opportunity to take the action. b. the value to you of the next best action you could have taken. c. the cost to society of giving you the opportunity to take the action. d. the dollar cost to you of the action.
Today, primary commodities
A) are not a major export for most of Latin America. B) are highly valued relative to manufactured goods. C) have benefited from increased demand from growing world economies. D) are not subject to business cycles.