Based on your answer to (b), what hap-pened to the value of the U.S. dollaragainst this basket between 2009 and2010? How does this compare with thechange in the value of the U.S. dollar rela-tive to the Mexican peso? Explain youranswer

Use the table that follows to answer this ques-tion. Treat the country listed as the homecountry, and treat the United States as theforeign country. Suppose the cost of the mar-ket basket in the United States is P US = $190.Check to see whether purchasing power par-ity (PPP) holds for each of the countrieslisted, and determine whether we should ex-pect a real appreciation or real depreciationfor each country (relative to the UnitedStates) in the long run. For the answer, createa table similar to the one shown and fill in theblank cells. (Hint: Use a spreadsheet applica-tion such as Excel.)P R O B L E M SPrice of Is FX CurrencyPrice of U.S. Basket Real Is FX Expected toCountry Market in FX Exchange Does PPP Currency Have Real(currency measured Per $, Basket (Pus times Rate, Hold? Overvalued or Appreciation orin FX units) EFX/$ (in FX) EFX/$ ) qCOUNTRY/US (yes/no) Undervalued? Depreciation?Brazil (real) 2.1893 520India (rupee) 46.6672 12,000Mexico (peso) 11.0131 1,800South Africa (rand) 6.9294 800Zimbabwe (Z$) 101,347 4,000,000

An appreciation of the domestic currency results in the following:You Answered  Improve the net foreign asset position Correct answer  Reduce the net foreign asset position   No change in the net foreign asset position

Multiple Choice QuestionBecause a country's imports vary directly with its income level, a rise in Canada's income level relative to that of the United States results in which of the following?Multiple choice question.The purchase of fewer U.S. goods by Canadians and the depreciation of the Canadian dollarThe purchase of more Canadian goods by Americans and the depreciation of the U.S. dollarThe purchase of fewer Canadian goods by Americans and the depreciation of the U.S. dollarThe purchase of more U.S. goods by Canadians and the depreciation of the Canadian dollar

One U.S. dollar can purchase 9.09 Swedish Krona (SEK). If the GDP of Sweden is 85,000 SEK, what is its value when measured in U.S. dollars? Round your answer to the nearest hundredth.

You are planning a graduation trip to Mexico. Other things the same, if the peso appreciates relative to the dollar, then the dollar buysGroup of answer choicesmore pesos. Your hotel room in Mexico will require fewer dollars.fewer pesos. Your hotel room in Mexico will require fewer dollars.more pesos. Your hotel room in Mexico will require more dollars.fewer pesos. Your hotel room in Mexico will require more dollars.