Solve clearly

If US prices are higher than European prices, when expressed In the same mrrency, then O the US dollar would be undervalued; it lakes more than one US basket to obtain one European basket. 0 the US dollar would be overvalued: It takes more than one US basket to obtain one European basket. 0 the US dollar would he overvalued: It takes less than one US basket to obtain one European basket. 0 the US dollar would be undervalued; it takes less than one US basketto obtain one European basket. Consider the (simple) monetary approach of modeling exchange rates in the long-run. Assume prices are flexible and real Income is growing at a constant money is growing at a constant rate, yet slower than real income, then one would expect that the price level O is decreasing. is constant. O is growing at a slower rate than the money supply. O is growing at a faster rate than the money supply