To determine the real exchange rate between two currencies, one must know the:
A) nominal exchange rate and the aggregate price level in both countries.
B) nominal exchange rate and the aggregate price level in both countries
C) amount of exports and imports between the two countries
D) amount of exports and imports between the two countries.
E) balance of payments in each country
F) balance of payments in each country.
G) purchasing power parity exchange rate
H) purchasing power parity exchange rate.
Correct Answer:
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