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Suppose the nominal exchange rate was 15 yen per mark, Japan produced silk for 2 yen. Germany produced water for 6 marks. What is the
Suppose the nominal exchange rate was 15 yen per mark, Japan produced silk for 2 yen. Germany produced water for 6 marks. What is the real exchange rate? If the price level in Germany rises to 8 marks, what must the nominal exchange rate become if the real exchange rate remains unchanged?
45 silk/water; 11.25 yen/mark
45 silk/water; 60 yen/mark
5 silk/water; 6.66 yen/mark
25 silk/water, 60 yen/mark
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