Use the Information Provided Below to Answer the Following Question(s)

question 60

Multiple Choice

Use the information provided below to answer the following question(s) .
The exchange rate between the British pound and the U.S. dollar is 2. In England, the price level is 1.0 and the one-year interest rate is 20%. In the United States, the price level is .8 and the one-year interest rate is 8%. The inflation rate in both countries is zero.
-Refer to the information above.The price of U.S.goods measured in pounds is

• A).8.
• B)1.0.
• C)1.6.
• D)2.
• E) none of the above

---

Definitions:

Common Stock

Represents ownership shares in a corporation, giving holders voting rights and a share in the company's profits through dividends.

Net Income

The conclusive earnings of a firm after removing all financial outlays and tax obligations from its aggregate revenue.

Equity Method

An accounting technique used by firms to assess the profits earned by their investments in other companies, incorporating the income on the investor's income statement.

Amortization

The approach of progressively depreciating the initial investment in an intangible asset over its effective life.