If the implied exchange rate between Big Mac prices in the United States and the Philippines is 68 pesos per dollar, but the actual exchange rate between the United States and the Philippines is 43 pesos per dollar, which of the following would you
expect to see?
A) a depreciation of the dollar B) an increase in the demand for dollars
C) an appreciation of the Philippine pesos D) a decrease in the demand for dollars
B
You might also like to view...
What effect does a price hike have on the total revenue of the producers?
What will be an ideal response?
The sale of foreign assets by a central bank accompanied by an open market purchase of securities of the same size results in:
A) a reduction in the monetary base B) an increase in the monetary base C) a sterilized intervention D) an unsterilized intervention
Short-run average cost exceeds long-run average cost only when there are economies of scale
Indicate whether the statement is true or false
During 2016, Yolanda's assets equal $400,000 and her liabilities were $550,000. Yolanda's net worth is
A. -$150,000. B. $150,000. C. $475,000. D. $950,000.