The price of gold is $300 per ounce in New York and 2,550 pesos per ounce in Mexico City. If the law of one price holds for gold, the nominal exchange rate is ________ pesos per U.S. dollar.
A. 85.5
B. 8.5
C. 1.18
D. 0.118
Answer: B
You might also like to view...
A severe drought has damaged this year's lettuce crop. The initial effect on the lettuce market is a
A) decrease in the demand for lettuce. B) decrease in the supply of lettuce. C) decrease in both the demand and supply of lettuce. D) rightward movement along the demand curve for lettuce.
If Camila's income rises by 20 percent, and, as a result, she purchases 40 percent more dresses, her income elasticity for dresses is
a. 0.5. b. 1.0. c. 2.0. d. Not enough information is given to answer this question.
If someone asked you to predict the price of gas in a month, and you decided to just guess by adding a few cents to the current price of gas, which you know, your answer would exhibit:
A. rational expectations. B. time inconsistency. C. anchoring. D. transitivity.
Maximum Feasible Hourly Production Rates of EitherComputers or Bicycles Using All Available ResourcesProductUnited StatesCanadaComputers810Bicycles42Refer to the above table. If opportunity costs are constant, then the United States and Canada will produce goods in which they have a comparative advantage and trade at a rate of exchange of
A. 6 computers for 1 bicycle. B. 0.1 computer for 1 bicycle. C. 4 computers for 1 bicycle. D. 1 computer for 1 bicycle.