High School

The Canadian price level is 110, the Japanese price level is 97.4, and the real exchange rate is 104 Japanese real GDP per unit of Canadian real GDP. What is the nominal exchange rate?

The nominal exchange rate is yen per dollar.

Provide your answer to 2 decimal places.

Answer :

Final answer:

To calculate the nominal exchange rate, use the formula: Nominal Exchange Rate = (Japanese Price Level x Japanese Real GDP per unit of Canadian Real GDP) / Canadian Price Level.

Explanation:

To calculate the nominal exchange rate, we can use the formula: Nominal Exchange Rate = (Japanese Price Level x Japanese Real GDP per unit of Canadian Real GDP) / Canadian Price Level. Plugging in the given values, we have: Nominal Exchange Rate = (97.4 x 104) / 110. Calculating this, we find that the nominal exchange rate is approximately ______ yen per dollar.

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