If the bank is selling euros for 0.74, then what is the implied ...

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If the bank is selling euros for 0.74, then what is the implied euro price of the dollar?
 
  A) 1.35
  B) 1.74
  C) 2.48
  D) None of these values are correct.

Question 2

The expected rate of change in the nominal dollar/euro exchange rate is best described as
 
  A) the expected rate of change in the real dollar/euro exchange rate minus the U.S.-Europe expected inflation difference.
  B) the expected rate of change in the real dollar/euro exchange rate plus the U.S.-Europe real interest rate difference.
  C) the expected rate of change in the real dollar/euro exchange rate plus the U.S.-Europe expected inflation difference.
  D) the expected rate of change in the real dollar/euro exchange rate minus the U.S.-Europe real interest rate difference.
  E) the expected rate of change in the real dollar/euro exchange rate plus the European expected inflation.

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Answer to Question 1

A

Answer to Question 2

C

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Excellent

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Gracias!