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DedPeter [7]
4 years ago
6

Consider the following conditions​: follows The exchange rate between the U.S. dollar and the British pound is pound.equals​$1.

follows The U.S. price level is 100 and the British price level is 105. The real exchange rate equals nothing. ​(Enter your response rounded to two decimal​ places.)
Business
2 answers:
Norma-Jean [14]4 years ago
4 0

Answer:

<u>The real exchange rate equals</u>

<u>1.05</u>.

<em>Explanation:</em>

To calculate the real exchange rate use the formula:

R = (E x P*)/P

Where:

R: real exchange rate =?

E: nominal exchange rate =$1

P*: foreign price level =105

P: domestic price level =100

R= (1 x 105) / 100 =1.07 rounded to two decimal​ places.

Remember, the real exchange rate is only a measure of the price of foreign goods relative to the price of domestic goods of a country.

Firdavs [7]4 years ago
4 0

Answer:

1.05 real exchange rate between the US dollar and the British pound.

Explanation:

The equation for calculating real exchange rate is:

RER = eP* / P

  • e = nominal dollar-pound exchange rate
  • P* = average price of a good in Great Britain
  • P = average price of a good in the US

RER = (1 x 105) / 100 = 105 / 100 = 1.05 real exchange rate between the US dollar and the British pound.

This means that the British pound is overvalued compared to the US dollar.

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Answer:

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Computers and computer accessories are complementary products. These are goods that are used together. An increase in demand for one product results in increased demand for the other. Should consumers have more money to buy computers, the demand for computers will increase, and their prices will also increase.

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I hope my answer helps you

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You have already decided to move. Your marginal decision is whether to move to Boston from Chicago,

You have already decided to spend the day on Saturday. Your marginal decision is whether to watch a movie or go hiking.

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Health Care Event Protection
Genrish500 [490]

Answer:

$ 132,500

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