If the Inflation Rate in Mexico Was Twice the Rate

question 25

Multiple Choice

If the inflation rate in Mexico was twice the rate in the United States, but the Mexican monetary authorities kept the peso-dollar exchange rate almost constant, which of the following would be true?

• A)The high inflation rate in Mexico would increase its citizens' purchasing power.
• B)The high inflation rate in Mexico would mean that its products would cost less overall.
• C)Mexican products would be less expensive, while U.S.-made products would become comparatively more expensive.
• D)Mexican products would be more expensive, while U.S.-made products would become comparatively less expensive.
• E)U)S.-made products would become less attractive to purchase.

---

Definitions:

Promote Learning

Actions or strategies aimed at enhancing the acquisition of knowledge, skills, attitudes, and behaviors among individuals or groups.

Timely

Occurring at a suitable or opportune moment, ensuring relevance and effectiveness.

Personal Feedback

The information given to individuals regarding their performance, behavior, or characteristics, intended to support their development and improvement.

Flying Blind

Making decisions or taking actions without having sufficient information or data, akin to navigating without visual references.