If the price in Canada was C50 and the price in Switzerland was ...

[schs14]

If the price in Canada was C50 and the price in Switzerland was SFr 100, absolute purchasing power parity would indicate that:
 a. The nominal value of the Swiss franc should rise by 100.
  b. The nominal exchange rate should be equal to C2/SFr.
  c. The nominal value of the Canadian dollar should rise by 100.
  d. The nominal exchange rate should be equal to C0.50/SFr.
  e. None of the above.

Question 2

Which of the following exchange rate systems is advisable for a country that would like to have greater exchange rate stability but also would like to have the its exchange rate change gradually over time as its prices relative to other countries change?
 a. Crawling peg
  b. Fixed exchange rates
  c. Managed float
  d. Fixed rates within bands

[ciecieme]

Answer to Question 1

.D

Answer to Question 2

.A

[schs14]

Thank you

[ciecieme]

Happy to help you