The current exchange rate

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Reference no: EM13902916

Currently a basket of goods costs 50 pounds in England and 100 euros in France. Next year at the same time, we expect 10% inflation in England and 65% inflation in France. Based on the above information and the PPP concepts, the current exchange rate (pound:euro) is _______ and the rate at this time next year will be ______.

A) 2:1; 3:1

B) 1:2; 1:3

C) 1:2; 3:1

D) 2:1; 1:3

Reference no: EM13902916

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