A nominal appreciation of the Mexican peso (against all currencies) indicates that
A) the peso price of foreign currency has risen.
B) the Mexican real exchange rate will not change if the price level in Mexico falls.
C) the peso price of, for example, the U.K. pound has decreased.
D) the number of units of foreign currency that one can obtain with one peso has increased.
Question 2
In the Phillips curve equation, which of the following will cause an increase in the current inflation rate?
A) an increase in the expected inflation rate
B) a reduction in the unemployment rate
C) an increase in the markup, m
D) all of the above
E) none of the above
