Suppose That Australia's Price Level Is 200,the British Price Level
Suppose that Australia's price level is 200,the British price level is 100,and the nominal exchange rate of pounds to the dollar is £0.40 = $1,then the real exchange rate of pounds to the dollar is ________.
If the exchange rate between the dollar and the yen is ¥80 = $1 this week,and is ¥87 = $1 next week,we say that the dollar appreciated.
A rise in the dollar price of the Chinese yuan signals an appreciation of the yuan and a depreciation of the dollar.
Ceteris paribus,an appreciation of the dollar will increase net exports in Australia.