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Lena [83]
3 years ago
6

If purchasing power parity holds, then if the price of a basket of goods in the U.S. rose from $1.000 to $1,200 and the price of

the same basket in Poland rose from 6,400 Polish zloty to 8,000 zloty, then a. the nominal exchange rate would be unchanged and the real exchange rate would appreciate. b. the U.S. dollar would appreciate and the real exchange rate would stay the same. c. the nominal exchange rate would be unchanged and the real exchange rate would depreciate. d. the U.S. dollar would depreciate and the real exchange rate would be unchanged.
Business
1 answer:
jonny [76]3 years ago
6 0

Answer:

b) The US dollar would appreciate and the real exchange rate would stay the same.

Explanation:

Increase in Inflation in US: 1,200 / 1,000 - 1 * 100 = 20%

Increase in Inflation in Poland: 8,000 / 6,400 - 1 * 100 = 25%

Law of one price states that identical goods should be exchanged at equal prices in different countries valued in local currencies. This law is known as purchasing power parity theory.

According to the theory, increase (decrease) in prices of goods or a basket of goods in one country will result in depreciation (appreciation) of its currency so exchange rate-adjusted prices are constant across countries.

In our question, the price of basked of goods has increased by 25% in Poland as compared to 20% in U.S. thus implying depreciation of Polish zloty against US dollar or appreciation of US against Policy zloty.

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Answer:

20m/s due east

Explanation:

Given parameters:

Displacement  = 180m due east

Time taken = 9s

Unknown:

Average velocity of the truck  = ?

Solution:

The average velocity is the displacement divided by the time taken;

   Average velocity  = \frac{displacement}{time}  

Insert the parameters and solve;

 Average velocity = \frac{180}{9}   = 20m/s due east

6 0
3 years ago
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Drupady [299]

Answer:  Option C

         

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3 years ago
A work group _______ may be defined as a standard that is shared by group members and that regulates member behavior within an o
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7 0
2 years ago
Which of the following statements about the Consumer Decision Process is false?
Harman [31]

Answer:

The answer is: A) In a successful purchase, every stage in the process has to happen.

Explanation:

Sometimes we as customers don´t have the time or are unable to follow all the stages in the consumer decision process. Many times it depends on what need we want to satisfy. For instance, if we are hungry or thirsty we might decide to eat at the first restaurant we find. It doesn´t mean we made a bad choice, it simply happened that way because we didn´t have time to research about all the restaurants in the area and then evaluate and decide which one was the best for us. Many daily purchases are part of our daily routine. Imagine how many hours we would spend at a grocery store if we had to follow every step of the process.

On the other hand, if I´m searching for a new house, I will follow steps one through five several times, over and over again until I finally decide which house to buy.

7 0
3 years ago
If an increase in the price of a product from $1 to $2 per unit leads to a decrease in the quantity demanded from 100 to 80 unit
Ksenya-84 [330]

Answer:

-0.33

Explanation:

The calculation of the price elasticity of demand using mid point formula is shown below:

= (change in quantity demanded ÷ average of quantity demanded) ÷ (percentage change in price ÷ average of price)  

where,  

Change in quantity demanded is

= Q2 - Q1

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= -20 units

And, the average of quantity demanded would be

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And, the average of the price is

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= 1.5

So, after solving this, the price elasticity of demand is -0.33

7 0
3 years ago
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