Suppose that in 2012 the nominal exchange rate for U.S. dollars and British pounds is $1.4/pound. In addition, let us assume that the base year is 2010, at which consumer prices are set equal to 100. By 2012, the U.S. consumer prices increased to a level of 110, while British consumer prices increased to a level of 106. What was the real exchange rate in 2012?

a) $2.65/pound

b) $1.45/pound

c) $1.35/pound

d) $1.4/pound