The real exchange rate shows the amount of foreign currency needed to purchase d

Question

The real exchange rate shows

the amount of foreign currency needed to purchase domestic goods.

the amount of domestic currency needed to purchase foreign goods.

the rate at which foreign exchange can be purchased.

the rate at which goods and services in one country can be converted into goods and services in another country.

the amount of foreign currency needed to purchase domestic goods.

the amount of domestic currency needed to purchase foreign goods.

the rate at which foreign exchange can be purchased.

the rate at which goods and services in one country can be converted into goods and services in another country.

Explanation / Answer

Option 4 is the right answer. It is the exchange rate of the goods across countries. It means if the exchange rate fluctuates the prices of the goods also gets fluctuate and it is a critical variable in determining the capital account

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.