Author Question: Assume that the price levels in two countries are constant. In this situation, we know that A) ... (Read 88 times)

stevenposner · **on:** Jun 30, 2018

Assume that the price levels in two countries are constant. In this situation, we know that

A) neither the real nor the nominal exchange rate can change.
B) the real exchange rate can change, while the nominal exchange rate is constant.
C) the nominal exchange rate can change, while the real exchange rate is constant.
D) the real and nominal exchange rate must move together, changing by the same percentage.
E) the nominal exchange rate will fluctuate more widely than the real exchange rate.

Question 2

In the OECD countries, there is a negative relationship between output per capita in 1950 and

A) growth since 1950.
B) output per capita in the 1990s.
C) distance from the equator.
D) population.
E) none of the above