When Referring to a Currency as Strong or Weak, Economists

question 20

Multiple Choice

When referring to a currency as strong or weak, economists typically use which of the following indicators?

• A) A real exchange rate below 1 or falling means strong, and a real exchange rate above 1 or rising means weak.
• B) A real exchange rate above 1 or rising means strong, and a real exchange rate below 1 or falling means weak.
• C) A nominal exchange rate below 1 or falling means strong, and a nominal exchange rate above 1 or rising means weak.
• D) A nominal exchange rate above 1 or rising means strong, and a nominal exchange rate below 1 or falling means weak.

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