Statement: You are an Australian investor, and are considering purchasing Hong-Kong (HDK) denominated bonds. All else equal, an increase in the nominal AUD/HJD exchange rate means that your relative purchasing power for your Hong Kong trips will increased (based on your paying for your trip with income from your HKD denominated bonds). This statement is: incorrect, because purchasing power is not affected in this case. incorrect, based on the quote convention, your relative purchasing power would be decreasing correct