What will be effect of an expansionary monetary policy

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Assignment:

1) Suppose the price of a can of soda is €1.50 in France. Given that the nominal euro/dollar exchange rate is €1 = $1.40, how much would a can of soda cost the American tourist on holiday in Paris?

2) According to the theory of Purchasing Power Parity, what will be the effect of an expansionary monetary policy decided by a central bank on the currency of the country in question?

3) If the nominal exchange rate of the yen per dollar increases, does this mean that the dollar has appreciated?

4) If the supply of sterling currency increases faster than the supply of euro currency, the value of the pound should rise relative to the value of the euro.

5) -If a company based in Canada prefers a stronger dollar (a high exchange rate),

it's probably because it exports more and imports less?

Reference no: EM133543780

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