Assume that a Big Mac hamburger cost $3 in the United States 2 pesos in Mexico The implied purchasing power parity exchange rate between the peso and the dollar is ?

Related Mcqs:

A primary reason that explains the appreciation in the value of U.S dollar would be ?

A. large trade surpluses for the United States B. high inflation rates in the United States C. lack of investor confidence in U.S money policy D. high interest rates in the United States...

When the price of foreign currency (i.e the exchange rate) is below the equilibrium level ?

A. an excess demand for that currency exists in the foreign exchange market B. an excess supply of the currency exists in the foreign exchange market C. the demand for foreign exchange shifts outward to the right D. the demand for foreign exchange shifts backward to the left...

Suppose that rising U.S income leads to higher sales and profits in the United States This would likely result in ?

A. increasing portfolio investment into the United States B. decreasing portfolio investment into the United States C. increasing direct investment into the United States D. decreasing direct investment into the United States...

IF when cost $4 per bushel in the United States and 2 pounds per bushel in Great Britain then in the presence of purchasing power parity the exchange rate should be ?

A. $50 per pound B. $1.00 per pound C. $2.00 per pound D. $8.00 per pound...

Due to Japan’s high saving rate, suppose that the Japanese invest abroad. This investment may result in a/an _______ of the Japanese yen and therefore a for Japan?

A. appreciation; trade surplus B. appreciation; trade deficit C. depreciation; trade surplus D. depreciation; trade deficit...