Assume that the price of a car in the United States is equal to $20,000 and the same car in Japan is priced at 2,400,000 yen. If 1 car in the US is equal to only ½ car in Japan, then the nominal exchange rate between the two countries, based solely on this one product, is:
A) US$1 = ¥100
B) US$1 = ¥240
C) US$1 = ¥180
D) US$1 = ¥50
Correct Answer:
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