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From the base price level of 1 0 0 in 1 9 8 1 , Saudi Arabian and U . S . price levels in

From the base price level of 100 in 1981, Saudi Arabian and U.S.
price levels in 2010 stood at 410 and 100, respectively. Assume the
1981 $/riyal exchange rate was $0.34/riyal. Suggestion: Using the
purchasing power parity, adjust the exchange rate to compensate for
inflation. That is, determine the relative rate of inflation
between the United States and Saudi Arabia and multiply this times
$/riyal of 0.34.What should the exchange rate be in 2010?

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