If it took as many dollars to buy goods in Canada as it did to buy enough currency to buy the same goods in Honduras, the real exchange rate would be computed as how many Honduran goods per Canadian goods?
A) one
B) the number of dollars needed to buy Canadian goods divided by the number of lempira needed to buy Honduran goods
C) the number of lempira needed to buy Honduran goods divided by the number of dollars needed to buy Canadian goods
D) a number equal to the nominal exchange rate

Question

Quizplus · Accepted Answer

The real exchange rate in this scenario would be one Honduran good per Canadian good, as it costs the same amount of dollars to buy goods in both countries.

If It Took as Many Dollars to Buy Goods in Canada