Suppose 60,000 pesos buys a basket of goods in Mexico. If, at the existing exchange rate, it costs less than 60,000 pesos to buy the same basket of goods in the United States, then purchasing power parity implies that the:
A. dollar is overvalued.
B. dollar should cost more pesos.
C. dollar should cost fewer pesos.
D. peso is undervalued.
Answer: B
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In the political marketplace, voters do all of the following EXCEPT
A) benefit from public goods and services. B) pay some taxes. C) vote. D) evaluate policy proposals of bureaucrats.
In the long run, firms in a perfectly competitive market produce:
A. where average variable costs are minimized. B. at a quantity with positive economic profits. C. where price equals marginal cost. D. where MC is at its lowest point.
Variable costs usually change as the firm alters the quantity of output produced
a. True b. False Indicate whether the statement is true or false
The U.S. military defends Jacob from foreign attackers. The fact that Jacob enjoys this protection does not detract from others Americans' enjoyment of it. For this reason, we say that national defense is
a. excludable. b. not excludable. c. rival in consumption. d. not rival in consumption.