Question

# QUESTION 9 If the purchasing power parity predicted nominal exchange rate is greater than actual nominal...

QUESTION 9

1. If the purchasing power parity predicted nominal exchange rate is greater than actual nominal exchange rate, then
 a. the real exchange rate is greater than one b. the real exchange rate equals one c. the real exchange rate is less than one d. nothing can be said about the real exchange rate

QUESTION 10

1. If the indirect quote for the Polish zloty versus the U.S. dollar is 4 zloty per 1 dollar, then the direct quote would be .25 dollars per 1 zloty.

True

False

QUESTION 11

1. If the indirect quote exchange rate increases for a currency, the currency value rises.

True

False

If the purchasing power parity predicted nominal exchange rate is greater than actual nominal exchange rate, then:

c. the real exchange rate is less than one

the nominal exchange rate shows the exchange rate of currency between countries while real exchange rate shows the exchange of goods and services.

If the indirect quote for the Polish zloty versus the U.S. dollar is 4 zloty per 1 dollar, then the direct quote would be .25 dollars per 1 zloty.

true

because direct quote and indirect quote are inverse of each other. if indirect quote for 4 zloty is 1 U.S dollar than the direct quota will be 1 zloty = 1/4 =.25 dollar mean if in indirect quote with 1 U.S. dollar we are getting 4 zloty than in direct quote with 1 zloty we will get 0.25 dollar.

If the indirect quote exchange rate increases for a currency, the currency value rises.

False

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