The nominal exchange rate is the:[Fill in the blank]

Question

BlackTom AI · Accepted Answer

The nominal exchange rate is simply the price of one currency expressed in terms of another.

1) Relevant knowledge points and concepts
- Nominal exchange rate: the rate at which one currency can be exchanged for another (a market price). Example notation: e = domestic currency units per one unit of foreign currency (e.g., 1.20 USD/EUR means 1 EUR = 1.20 USD).
- Real exchange rate: adjusts the nominal rate for relative price levels across countries; often written q = e * (P_foreign / P_domestic) (or an equivalent expression depending on the chosen convention).
- Purchasing power parity (PPP) and the law of one price relate price levels and exchange rates but do not define the nominal rate itself.

2) Step-by-step reasoning
- The question asks for the definition of the nominal exchange rate.
- By definition, the nominal exchange rate equals how many units of one currency you receive for a unit of another currency — i.e., the trading rate between currencies.
- This is a direct market price, not an interest rate ratio or a price-of-a-good ratio.

3) Calculations / intermediate steps (illustrative)
- If e = 0.85 EUR/USD (depending on convention), then 1 USD = 0.85 EUR. No additional arithmetic is required to define the nominal rate; it is the quoted conversion ratio between currencies.
- To get a real exchange rate you would compute q = e * (P_foreign / P_domestic), showing that price ratios enter only after adjusting the nominal rate.

4) Why the correct answer is correct
- Option c matches the textbook definition: the nominal exchange rate is the rate at which currencies are traded (the conversion rate). It is the market price of one currency in terms of another.

5) Why the other options are incorrect
- a: Ratio of nominal interest rates is unrelated to the nominal exchange rate (it might be relevant in interest parity conditions, but does not define the exchange rate).
- b: Price of a good across countries is a price ratio; after combining with the nominal rate you can form the real exchange rate, but b alone is not the nominal exchange rate.
- d: Multiplying a real interest rate by a nominal interest rate is meaningless in this context.

6) Conclusion
Therefore the correct answer is c. This matches the provided answer: "rate at which a person can trade the currency of one country for the currency of another."

The nominal exchange rate is the:[Fill in the blank]单项选择题

类似问题

The exchange rate is best defined as:

Demand for the country’s exports falls. This would cause its currency to:

The country’s trade partners impose tariffs on its exports. This would cause its currency to:

The country imposes tariffs on imports. This would cause its currency to:

Appreciation of a currency will lead to:[Fill in the blank]

Which of the following groups will be unhappy if the Australian dollar appreciates?[Fill in the blank]

For a domestic exporter with all costs and output prices denoted in the domestic currency, an appreciation of the domestic currency will:

Which of these would by hurt by an appreciation of their domestic currency?

更多留学生实用工具

智能学习助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单