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A bundle of goods in Japan costs 3,012,000 while the same goods and services cost $27,200 in the United States. a. If purchasing power parity
A bundle of goods in Japan costs 3,012,000 while the same goods and services cost $27,200 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 6 percent in Japan and 3 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? | ||||
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