Which of the following events will cause the smallest change in the real exchange rate (?)?
A) a 6% drop in E and a 6% increase in the foreign price level (P)
B) a 6% increase in the domestic price level (P) and a 6% reduction in P
C) a 6% drop in E and a 6% reduction in P
D) a 3% increase in E
E) a 2% increase in E and a 2% increase in P
C
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