Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN: 9781305506725
Author: James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher: Cengage Learning
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Question
Chapter 19, Problem 4CQ
To determine
Exchange rate change of US dollar with British Pound and Canadian dollar.
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Students have asked these similar questions
In mid-2006, a British pound sterling (the monetary unit in the United Kingdom) was worth 1.4 euros (the monetary unit in the European Union). If a U.S. dollar bought 0.55 pound sterling in 2006, what was the exchange rate between the U.S. dollar and the euro?
What is the current (within the last 48 hours) exchange rate between the U.S. dollar and the Chinese Yuan?
In the picture below is the table to the question. The highlighted one is my guess which is wrong.
Based on the Exchange rates above, which currency has become stronger or appreciated against the dollar?
A)US Dollar
B)British Pound
C)Mexican Peso(this one is wrong)
D)Candian Dollar
Chapter 19 Solutions
Economics: Private and Public Choice (MindTap Course List)
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- A currency depreciates if it buys less of a foreign currency than it did before. The US dollar depreciated against what currency(a) from month 1 to month 2? Explain using the chartarrow_forwardIf the US dollar price of a Swedish krona changes from $.1572 to $.1730 had the dollar appreciated or depreciated against the krona and/ or krona and the dollar ?arrow_forwardAt the beginning of the year, the exchange rate between the Brazilian real and the U.S. dollar was 3.2 reals per dollar. Over the year, Brazilian inflation was 3 percent and U.S. inflation was 5 percent. Explain what should we expect to happen to the U.S. dollar relative to Brazilian real? Provide the intuition.arrow_forward
- A British pound costs $1.42 in U.S. dollars in 2018, but $1.55 in U.S. dollars in 2019. Was the pound weaker or stronger against the dollar? Did the dollar appreciate or depreciate versus the pound?arrow_forwardThe nominal exchange rate: a. Is the amount of one country's goods that could be obtained with the same goods of another country b. Is a synonymous term for the swap rate c. Is the rate that one can exchange the currency of one country for the currency of another country d. Is always expressed as units of a foreign currency per U.S. dollararrow_forwardIf Australia were pegging the Australian dollar to the US dollar and also trying to sterilize the effects of its exchange market intervention, then when it buys US dollars on the foreign exchange market, it should also sell Australian government bonds. buy US government bonds. sell US government bonds. buy Canadian government bonds.arrow_forward
- Other things being equal, an increase in a country's interest rates will cause its currency to depreciate. True False If the U.S. dollar had a value equal to 1 euro a year ago and is now worth 1.2 euros, we say that the euro has appreciated over the past year. True Falsearrow_forwardThe Dominican peso started the year at 55 pesos / $1, but then fell to 50 pesos / $1 over the summer. Was the Dominican peso stronger or weaker against the US dollar? Did the US dollar appreciate or depreciate against the Dominican peso?arrow_forwardA television costs $500 in the United States. The same television costs 312.5 euros. If purchasing power parity holds, what is the spot exchange rate between the euro and the dollar?arrow_forward
- The direct exchange rate of Rupee in the US is 0.4. The direct exchange or Rupee in the UK is 0.25. Calculate the cross rate of the British pound for the US.arrow_forwardA British pound costs $1.42 in U.S. dollars in 2018, but $1.55 in U.S. dollars in 2019. Calculate the cost of a U.S. dollar in terms of a British pound in 2018 and 2019. Show your work.arrow_forwardThe expression that represents the Australian dollar price in foreign currency is: 01/E EP* ○ EP/P* EP* |P EParrow_forward
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