According to Purchasing-Power Parity, If Prices in Canada Increase by a Larger

question 103

Multiple Choice

According to purchasing-power parity, if prices in Canada increase by a larger percentage than prices in Kenyan, how does the exchange rate change?

• A) The real exchange rate, defined as Kenyan goods per unit of Canadian goods, rises.
• B) The real exchange rate, defined as Kenyan goods per unit of Canadian goods, falls.
• C) The nominal exchange rate, defined as Kenyan currency per dollar, rises.
• D) The nominal exchange rate, defined as Kenyan currency per dollar, falls.

---

Definitions:

Acquired Immunodeficiency Syndrome (AIDS)

A chronic, potentially life-threatening condition caused by the human immunodeficiency virus (HIV), severely damaging the immune system.

Parotid Gland

The largest of the salivary glands, located near the ear, responsible for producing saliva to aid in digestion.

Cervical Lymph Nodes

Small, bean-shaped glands located in the neck area that are part of the lymphatic system, playing a role in the body's immune response.

Positive Romberg Sign

A sign of neurological dysfunction where a person sways or falls when standing with feet together and eyes closed, indicating proprioceptive or vestibular impairment.