Rather than a single good for the exchange rate,economists use the concept of ________ as the price base for the exchange rate.

Question

Quizplus · Accepted Answer

Economists use the concept of a basket of goods as the price base for the exchange rate. This basket typically includes a range of goods and services that are representative of the overall economy of a country, such as food, housing, transportation, and healthcare. By looking at the price changes of this basket of goods over time, economists can determine how the exchange rate has changed, and whether a currency has appreciated or depreciated relative to other currencies.

Rather Than a Single Good for the Exchange Rate,economists Use