Suppose that a compact discs costs $15 in the United States and £ 13 in the United Kingdom.The nominal exchange rate is $1.9382 per pound.What is the real exchange rate between United Kingdom And US ?

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Suppose that a compact discs costs $15 in the United States and £ 13 in the United Kingdom.The nominal exchange rate is $1.9382 per pound.What is the real exchange rate between United Kingdom And US ?

Calculate the real exchange rate between United Kingdom And US in terms of CD

Nmu macroeconomic

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Answer 1

Answer #1

Q20. 1.25 MXN couches per 1 US couch

1 US $ is can be exchanged for 25 MXN pesos. The price of 1 US couch is $500 and 1 MXN couch is 10000 pesos.

So, 1 US couch can be exchanged for (25*500)/10000 MXN couches.

So, 1 US couch can be exchanged for 1.25 MXN couches.

Q32. 1 US basket = 0.825 Mexican baskets

Real exchange rate of US basket =

(21*43430)/(1105141) = 0.825

So, 1 US basket can be exchanged for 0.825 Mexican baskets.

answered by: ANURANJAN SARSAM

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Answer 2

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Suppose that a compact discs costs $15 in the United States and £ 13 in the United Kingdom.The nominal exchange rate is $1.9382 per pound.What is the real exchange rate between United Kingdom And US ?

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Suppose that a compact discs costs $15 in the United States and £ 13 in the United Kingdom.The nominal exchange rate is $1.9382 per pound.What is the real exchange rate between United Kingdom And US ?

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Suppose that a compact discs costs $15 in the United States and £ 13 in the United Kingdom.The nominal exchange rate is $1.9382 per pound.What is the real exchange rate between United Kingdom And US ?