Real exchange rate is appreciating-nominal exchange rate

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Reference no: EM131164580

If the real exchange rate is appreciating, the nominal exchange rate can be depreciating as long as:

a) (Price in home country / Price in foreign country) is rising faster than the nominal exchange rate is falling.

b) (Price in foreign country / Price in home country) is falling faster than the nominal exchange rate is falling.

c) (Price in home country / Price in foreign country) is falling faster than the nominal exchange rate is falling.

d) (Price in foreign country / Price in home country) is rising faster than the nominal exchange rate is falling.

Reference no: EM131164580

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