Nominal effective exchange rate index

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Reference no: EM131317039

1. Exchange Rate – Pass Through. Incomplete exchange rate pass – through is one reason that a country’s real effective exchange rate can deviate for lengthy periods from its purchasing power equilibrium level of 100. What is meant by the term exchange rate pass through?

2. Nominal Effective Exchange Rate Index. Explain how a nominal effective exchange rate index is constructed.

Reference no: EM131317039

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