If inflation was lower in the UK than in France, then under a floating exchange rate, which of the following would be true?
A) The nominal value of the euro will rise against the pound.
B) The nominal value of the euro will fall against the pound.
C) The nominal exchange rate of the euro against the pound will remain constant.
D) The real exchange rate and the nominal exchange rate will remain constant.
Correct Answer:
Verified
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