Question
A bundle of goods in Japan costs 2,534,000 while the same goods and services cost $24,500 in the United States. a. If purchasing power parity
A bundle of goods in Japan costs 2,534,000 while the same goods and services cost $24,500 in the United States. a. If purchasing power parity holds, what is the current exchange rate of U.S. dollars for yen? (Round your answer to 4 decimal places. (e.g., 32.1616)) Current exchange rate $ per yen b. If, over the next year, inflation is 4 percent in Japan and 6 percent in the United States, what will the goods cost next year? Cost of Goods Japan United States $ c. Will the dollar depreciate or appreciate relative to the yen over this time period? Depreciate Appreciate
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