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There are three questions all linked. 1. (This information is used by all 3 questions). The spot exchange rate in January 2020 for the number

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There are three questions all linked. 1. (This information is used by all 3 questions). The spot exchange rate in January 2020 for the number of SKW (South Korean Won) per NRA (Nigerian Naira) USD is 9.0 . The consumer price index in South Korea stood at 100.0 in January 2020 and at 110.0 in January 2021. The consumer price index in Nigeria stood at 200.0 in January 2020 at 400.0 in January 2021. Q1: If (relative) Purchasing Power Parity exactly holds over the period January 2020 to January 2021. what should the spot exchange rate for the number of SKW per NRA be in January 2021? Give your answer correct to two decimal places. Q2: Suppose that the spot exchange rate for the number of SKW (South Korean Won) per NRA (Nigerian Naira) in January 2021 turned out to be 4.0 . Has the NRA: a. strengthened against the SKW in real terms but weakened in nominal terms, b. weakened against the SKW in real terms and weakened in nominal terms, c. strengthened against the SKW in real terms and strengthened in nominal terms, d. weakened against the SKW in real terms but strengthened in nominal terms, e. stayed the same in real terms, f. only Oliver the Finance Pug is clever enough to know the answer to this question. Q3: The information for this question is the same as for Q1 - EXCEPT THAT we NOW (replacing Q2) suppose that the spot exchange rate for the number of SKW (South Korean Won) per NRA (Nigerian Naira) in January 2021 turned out to be 5.1. Has the NRA: a. strengthened against the SKW in real terms but weakened in nominal terms, b. weakened against the SKW in real terms and weakened in nominal terms, c. strengthened against the SKW in real terms and strengthened in nominal terms, d. weakened against the SKW in real terms but strengthened in nominal terms, e. stayed the same in real terms

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