The Next Questions Refer to the Following

question 23

Multiple Choice

The next questions refer to the following.
Suppose the nominal Canadian - US exchange rate is C$1 = US$0.65 (so that one Canadian dollar buys 65 US cents) , and the Canadian price level is twice as high as the US price level.
-The real value of US$1 in Canada is then

• A) C$0.65
• B) C$0.77
• C) C$1.30
• D) C$1.40
• E) C$1.54

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Definitions:

Monthly Basis

A term referring to events or calculations repeated or measured every month.

Round Answers

The process of adjusting the decimal places of a number to simplify it, based on specific rounding rules.

Simple Interest

Interest calculated on the principal portion of a loan or deposit, using a simple calculation that does not compound.

Monthly Basis

An occurrence or calculation that happens every month.