If Inflation in the United States Rises Relative to the Inflation

question 117

Multiple Choice

If inflation in the United States rises relative to the inflation rate in Mexico,the dollar will __________ in terms of the peso and the peso will __________ in terms of the dollar.

• A) remain unaffected; appreciate
• B) remain unaffected; depreciate
• C) depreciate; remain unaffected
• D) depreciate; appreciate
• E) remain unaffected; remain unaffected

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