Between last year and this year, the CPI in Blueland rose from 100 to 120 and the CPI in Redland rose from 100 to 115. Blueland's currency unit, the blue, was worth 80 cents (U.S.) last year and is worth 60 cents (U.S.) this year. Redland's currency unit, the red, was worth 20 cents (U.S.) last year and is worth 15 cents (U.S.) this year. Find the percentage change from last year to this year in Blueland's nominal exchange rate with Redland and in Blueland's real exchange rate with Redland. (Treat Blueland as the home country.) Relative to Redland, do you expect Blueland's exports to be helped or hurt by these changes in exchange rates? Instructions: Enter your responses rounded to one decimal place. Change in nominal exchange rate: Change in real exchange rate: Blueland's exports will be hurt %

Between last year and this year, the CPI in Blueland rose from 100 to 120 and the CPI in Redland rose from 100 to 115. Blueland's currency unit, the blue, was worth 80 cents (U.S.) last year and is worth 60 cents (U.S.) this year. Redland's currency unit, the red, was worth 20 cents (U.S.) last year and is worth 15 cents (U.S.) this year. Find the percentage change from last year to this year in Blueland's nominal exchange rate with Redland and in Blueland's real exchange rate with Redland. (Treat Blueland as the home country.) Relative to Redland, do you expect Blueland's exports to be helped or hurt by these changes in exchange rates? Instructions: Enter your responses rounded to one decimal place. Change in nominal exchange rate: Change in real exchange rate: Blueland's exports will be hurt %

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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