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Data on the Real Exchange Rate for Canada Vs

Question 1

Multiple Choice
Data on the real exchange rate for Canada vs.the U.S.indicates that

Data on the real exchange rate for Canada vs.the U.S.indicates that


A) the real exchange rate has fluctuated significantly while the theory predicts it should be constant.
B) the real exchange rate has been constant while the theory predicts it should fluctuate.
C) the real exchange rate has fluctuated little consistent with the theoretical predictions.
D) the real exchange rate has decreased while the theory predicts it should increase.
E) the real exchange rate has increased consistent with the theoretical predictions.

Correct Answer:

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