Suppose,under a system of flexible exchange rates,a small TV costs $150 in the United States and 15,000 yen in Japan.Other things being equal,the exchange rate is
A) 1 yen equals $0.15.
B) $1 equals 15 yen.
C) 1 yen equals $0.01.
D) $1 equals 150 yen.
E) $1 equals 1,500 yen.

Question

Quizplus · Accepted Answer

To find the exchange rate, divide the cost in yen by the cost in dollars: 15,000 yen / $150 = 100 yen per dollar, which means 1 yen equals $0.01.

Suppose,under a System of Flexible Exchange Rates,a Small TV Costs