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In the US, a big mac cost $4.55. If you buy the same big mac in Norway, it will cost 14.56 Kroner. Suppose that the

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In the US, a big mac cost $4.55. If you buy the same big mac in Norway, it will cost 14.56 Kroner. Suppose that the current exchange rate is $1 US buys 2.85 Kroner. According to the law of one price, the exchange rate should be that $1 US buys __Kroner, and hence, we can predict that over time, the US dollar should against the Kroner 2.75: appreciate 2.75; depreciate O 3.2; appreciate O 3.2; depreciate

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