In the long run, the nominal exchange rate
A) is a monetary phenomenon, determined by the quantities of money in two countries.
B) is fixed by world central banks, as indicated by the fixed exchange rate system.
C) is not related to the real exchange rate, since the real exchange rate is the true value of currencies.
D) will not change if prices in one country change, since prices are nominal variables.
Correct Answer:
Verified
Q208: If the nominal exchange rate rises and
Q209: Initially the nominal exchange rate between the
Q210: Suppose the Fed wants to fix the
Q211: Given the U.S. price level P, the
Q212: The Fed_ intervene in the foreign exchange
Q214: Suppose that $1 U.S. costs $1.50 Canadian.
Q215: The real exchange rate is the
A) relative
Q216: _can intervene directly in the foreign exchange
Q217: The nominal exchange rate is
A) the relative
Q218: The Federal Reserve can influence the exchange
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