4. The following figure reproduces the real exchange rate between the US Dollar and the German Mark. Up to 1974 there was a fix nominal exchange rate with a floating exchange rate thereafter. Assuming the shocks hitting both economies have been similar across both sub-periods, what can we infer from the differential volatility of the real exchange rate? Do nominal variables affect real variables? LO Percent -15 1960 1965 1970 1975 1980 1985 Year Figure 3: Monthly Change in the US-German Real Exchange Rate