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Suppose the Real Exchange Rate Is 3/4 Gallon of Country

Question 45

Multiple Choice

Suppose the real exchange rate is 3/4 gallon of country A's gasoline per gallon of U.S.gasoline,a gallon of U.S.gasoline costs $3.00 U.S. ,and a gallon of gas in country A costs 6 units of their currency.What is the nominal exchange rate?


A) 3/8 of a unit of country A's currency per dollar.
B) 3/2 units of country A's currency per dollar.
C) 8/3 units of country A's currency per dollar.
D) None of the above is correct.

Correct Answer:

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