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true or false, explain

Define the exchange rate as the amount of U.S. dollars per euro (EUSD/euro). Under the General Model of Long-Run Exchange Rat

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Exchange rate of 1 U.S dollars per euro is equal to 0.92 . Under the general model of long run exchange rate it says that an increase in demand of US dollar would reletively effect the euro. As we know that the dollar is more as compared to euro than the change in the dollar would change euro. For example a good can cost £100 and the same good can cost $120 then as per general model the exchange rate would be 1.2.

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