If the Real Exchange Rate Is Greater Than 1, Then

question 371

Multiple Choice

If the real exchange rate is greater than 1, then the

• A) nominal exchange rate x U.S. price > foreign price. The dollars required to purchase a good in the U.S. would buy more than enough foreign currency to buy the same good overseas.
• B) nominal exchange rate x U.S. price > foreign price. The dollars required to purchase a good in the U.S. would not buy enough foregoing currency to buy the same good overseas.
• C) nominal exchange rate x U.S. price < foreign price. The dollars required to purchase a good in the U.S. would buy more than enough foreign currency to buy the same good overseas.
• D) nominal exchange rate x U.S. price < foreign price. The dollars required to purchase a good in the U.S. would not buy enough foreign currency to buy the same good overseas.

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Definitions:

Interest Groups

are organized groups of individuals or organizations that seek to influence public policy and decision-making to favor their shared interests or goals, often through lobbying, advocacy, or campaigns.

Gender Gap

The discrepancy in opportunities, status, attitudes, and pay between men and women.

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A small group of powerful individuals, often from business, government, and the military, who hold significant power and influence over a society.

Autonomous State

A self-governing and independent political entity.