Homework Answers
Ans) Real exchange rate = nominal exchange rate × (domestic price level ÷foreign price level )
1) Real exchange rate = 6×(100÷100) = 6
2) Real exchange rate = 6×(110÷100) = 6.6
3) Real exchange rate = 6×(100÷110) = 5.45
4) 6 = nominal exchange rate ×(110÷100)
Nominal exchange rate = 5.45
5) 6 = nominal exchange rate ×(100÷110)
Nominal exchange rate = 6.6
When real exchange rate is high, relative prices of goods at domestic country is higher. When real exchange rate is low, relative prices at domestic country is lower.
Add Answer to:
7 Fill in the missing information in each of the follow- ing examples. Real Nominal Domestic Price Foreign Price Ex...
Suppose the real exchange rate is 10, the domestic price level is 8, and the foreign...
Suppose the real exchange rate is 10, the domestic price level is 8, and the foreign price level is 4. What is the nominal exchange rate? (3%) a. Suppose the real exchange rate rises by 10%, the inflation rate in the domestic b. country is 6%, and the inflation rate in the foreign country is 4%. By what percentage does the nominal exchange rate change? (3%) Suppose the nominal exchange rate rises by 5%, the real exchange rate rises by...
QUESTION 4 Suppose that domestic price level is constant and foreign price level increases and the...
QUESTION 4 Suppose that domestic price level is constant and foreign price level increases and the nominal exchange rate depreciates. How will the real exchange rate be affected? real exchange rate appreciates real exchange rate depreciates real exchange rate is not affected none of the above
19. If the nominal exchange rate falls 10 percent, the domestic price level rises 4 percent,...
19. If the nominal exchange rate falls 10 percent, the domestic price level rises 4 percent, and the foreign price level rises 6 percent, the real exchange rate will fall: A) Opercent. B 8 percent. C) 10 percent. D) 12 percent.
Saved Connect Problem CP 7-11 (algo) Fill in the missing values in the table below. Instructions:...
Saved Connect Problem CP 7-11 (algo) Fill in the missing values in the table below. Instructions: Round your answers to 1 decimal place. Nominal Gross Real Gross Year Domestic Product Domestic Product Price Index S billions) 15214.4 ($ billions) (Year 0 100) 101.7 15270.6 15604.7 15862.2 16232.2 103.8 16405.3 107.4 5 17643.1 18286.6 6 110.5 < Prev 16 of 23
Fill in the missing information: Year Nominal GDP Real GDP GDP Deflator 1 $8,000 billion $8,000...
Fill in the missing information: Year Nominal GDP Real GDP GDP Deflator 1 $8,000 billion $8,000 billion 100 $ 2 $9,028.8 billion 108 billion 3 $9,806.28 $8,527.2 billion The economy's growth rate is % from year 1 to year 2 and % from year 2 to year 3.
The nominal exchange rate (E) as defined in the text represents the price of domestic currency...
The nominal exchange rate (E) as defined in the text represents the price of domestic currency in terms of foreign currency. none of the above the number of units of foreign currency you can obtain with one unit of domestic currency. the number of units of domestic goods you can obtain with one unit of foreign goods. both A and C For this question, suppose the domestic interest rate is 4% and that the foreign interest rate is 7%. And...
(3) Fill in the missing numbers. Show your computations. (4) (2) GDP Price Nominal GDP, Real...
(3) Fill in the missing numbers. Show your computations. (4) (2) GDP Price Nominal GDP, Real GDP, Index Year Billions Billions (2009 = 100) 1995 $ 7,664.0 $10,167.3 2000 10,289.7 81.9 2005 13,095.4 14,235.6 92.0 2009 14,417.9 100.0 2010 14,958.3 14,779.4 101.2 2015 17.947.0 16,348.9 109.8
Using the information in this chapter, label each of the following statements true, false, or uncertain....
Using the information in this chapter, label each of the following statements true, false, or uncertain. Explain briefly. IF YOU ARE NOT GONNA ANSWER ALL OF THEM ABSTAIN FROM COMMENTING HERE. THANKS a.If the nominal exchange rate is fixed, the real exchange rate is fixed. b. When domestic inflation equals foreign inflation, the real exchange rate is fixed. c. A devaluation is an increase in the nominal exchange rate. d. Britain’s return to the gold standard caused years of high...
(1) If the world price is above the domestic equilibrium price, the domestic country is likely...
(1)
If the world price is above the domestic equilibrium price, the
domestic country is likely to ____________________ the good.
(2)
The difference between what an economy sells to and buys from
foreigners is _________________.
(3)
The idea that exchange rates and prices adjust to equalize the
cost of living across international boundaries is called
__________________________.
(4)
In the graph below, when the world price is $3, how many units
are...
The table below shows the nominal exchange rates (as of 25 February 2020) between the Swedish...
The table below shows the nominal exchange rates (as of 25 February 2020) between the Swedish krona (SEK) and the US dollar (USD) and the British pound (GBP), respectively. Foreign currency USD GBP SEK per foreign currency 10.45 13.46 a) Express the nominal exchange rates for SEK as foreign currency per SEK? (2p) b) What is the nominal exchange rate between USD and GBP, expressed as USD per GBP? (2p) c) Suppose that a representative basket of goods and services...
Suppose the real exchange rate is 10, the domestic price level is 8, and the foreign price level is 4. What is the nominal exchange rate? (3%) a. Suppose the real exchange rate rises by 10%, the inflation rate in the domestic b. country is 6%, and the inflation rate in the foreign country is 4%. By what percentage does the nominal exchange rate change? (3%) Suppose the nominal exchange rate rises by 5%, the real exchange rate rises by...
QUESTION 4 Suppose that domestic price level is constant and foreign price level increases and the nominal exchange rate depreciates. How will the real exchange rate be affected? real exchange rate appreciates real exchange rate depreciates real exchange rate is not affected none of the above
19. If the nominal exchange rate falls 10 percent, the domestic price level rises 4 percent, and the foreign price level rises 6 percent, the real exchange rate will fall: A) Opercent. B 8 percent. C) 10 percent. D) 12 percent.
Saved Connect Problem CP 7-11 (algo) Fill in the missing values in the table below. Instructions: Round your answers to 1 decimal place. Nominal Gross Real Gross Year Domestic Product Domestic Product Price Index S billions) 15214.4 ($ billions) (Year 0 100) 101.7 15270.6 15604.7 15862.2 16232.2 103.8 16405.3 107.4 5 17643.1 18286.6 6 110.5 < Prev 16 of 23
Fill in the missing information: Year Nominal GDP Real GDP GDP Deflator 1 $8,000 billion $8,000 billion 100 $ 2 $9,028.8 billion 108 billion 3 $9,806.28 $8,527.2 billion The economy's growth rate is % from year 1 to year 2 and % from year 2 to year 3.
The nominal exchange rate (E) as defined in the text represents the price of domestic currency in terms of foreign currency. none of the above the number of units of foreign currency you can obtain with one unit of domestic currency. the number of units of domestic goods you can obtain with one unit of foreign goods. both A and C For this question, suppose the domestic interest rate is 4% and that the foreign interest rate is 7%. And...
(3) Fill in the missing numbers. Show your computations. (4) (2) GDP Price Nominal GDP, Real GDP, Index Year Billions Billions (2009 = 100) 1995 $ 7,664.0 $10,167.3 2000 10,289.7 81.9 2005 13,095.4 14,235.6 92.0 2009 14,417.9 100.0 2010 14,958.3 14,779.4 101.2 2015 17.947.0 16,348.9 109.8
(1)
If the world price is above the domestic equilibrium price, the
domestic country is likely to ____________________ the good.
(2)
The difference between what an economy sells to and buys from
foreigners is _________________.
(3)
The idea that exchange rates and prices adjust to equalize the
cost of living across international boundaries is called
__________________________.
(4)
In the graph below, when the world price is $3, how many units
are...
The table below shows the nominal exchange rates (as of 25 February 2020) between the Swedish krona (SEK) and the US dollar (USD) and the British pound (GBP), respectively. Foreign currency USD GBP SEK per foreign currency 10.45 13.46 a) Express the nominal exchange rates for SEK as foreign currency per SEK? (2p) b) What is the nominal exchange rate between USD and GBP, expressed as USD per GBP? (2p) c) Suppose that a representative basket of goods and services...
Most questions answered within 3 hours.
-
QUESTION 6
Determine the linear momentum of a 2,800 kg houseboat going 3
m/s.
9,100 kg.m/s...
asked 6 minutes ago -
Draw the Lewis dot structures for the following molecules. None
of the atoms have a formal...
asked 12 minutes ago -
Question 5
What effect would a decrease in
temperature have on pressure, assuming that volume
(T)...
asked 8 minutes ago -
Jor-el throws a ball upward from the top of a 728 foot building
on the planet...
asked 10 minutes ago -
What does it mean when an element is radioactive?
a.
It means the element is changing...
asked 13 minutes ago -
A company deposits $6,000 in a bank at the end of every year for
10 years....
asked 12 minutes ago -
What are some strategies for eliminating service barriers?
By using your knowledge of
behavioral styles, please...
asked 20 minutes ago -
What are the decimal numbers for 159, 150, 200, 113, 225, 87,
106, 81 when converted...
asked 28 minutes ago -
Calculate and plot the number and weight distributions of x-mers
found in a step-growth polymerization for...
asked 48 minutes ago -
The Baily Corporation has developed a specialized software
program that improves inventory control capability. The following...
asked 52 minutes ago -
Problem 5-4A (Part Level Submission) Wolford Department Store is
located in midtown Metropolis. During the past...
asked 52 minutes ago -
Preparation of Benzoic Acid using a Grignard Reagent URGENT
1. During your Grignard formation, a small...
asked 1 hour ago