1. You are considering buying a very fancy painted statue from either Country A (which we'll call the domestic economy, if that's helpful) or Country B. In Country A's currency, the statue costs 400, and in Country B it costs 12,000. One unit of Country B's currency currently trades for 40 units of Country A's.

Calculate the real exchange rate, carefully following all numeric directions. We'll reuse this information in the next question.

2. Your money goes further in [ Select ] ["Country B", "Country A"] and, everything else equal, you could profit from [ Select ] ["buying it in Country A and reselling in Country B", "buying it in Country B and reselling in Country A"] .