Suppose the real exchange rate is 3/5 kilograms of Chilean beef per kilogram of Canadian beef, a kilogram of Canadian beef costs $3, and the nominal exchange rate is 500 Chilean pesos per dollar. What does Chilean beef cost?
A) 960 pesos per kilogram
B) 1200 pesos per kilogram
C) 1500 pesos per kilogram
D) 2500 pesos per kilogram
Correct Answer:
Verified
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