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Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364

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BuyFindarrow_forward

Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364
Textbook Problem

A British pound cost Chapter 29, Problem 32P, A British pound cost in U.S. dollars in but in U.S. dollars in Was the pound weaker or stronger , example  1 in U.S. dollars in Chapter 29, Problem 32P, A British pound cost in U.S. dollars in but in U.S. dollars in Was the pound weaker or stronger , example  2 but Chapter 29, Problem 32P, A British pound cost in U.S. dollars in but in U.S. dollars in Was the pound weaker or stronger , example  3 in U.S. dollars in Chapter 29, Problem 32P, A British pound cost in U.S. dollars in but in U.S. dollars in Was the pound weaker or stronger , example  4 Was the pound weaker or stronger against the dollar? Did the dollar appreciate or depreciate versus the pound?

To determine

If the pond was weaker than the dollar and if the dollar appreciate or depreciate the pond.

Explanation

Given information:

In 2008, £ 1= $2

In 2017, £ 1= $1.27

Rate of exchange between two currencies means the rate at which one currency can be converted to another. For example, the exchange rate between US dollars and Canadian dollars is 1US Dollar = 1.32 Canadian Dollar.

When the value of a currency improves vis-à-vis another currency, that currency is said to be have appreciated. Appreciation of a currency is indicated by a fall in the exchange rate. When the value of a currency deteriorates vis-à-vis another currency, that currency is said to be have depreciated. Depreciation of a currency is indicated by a rise in the exchange rate.

In 2008, it required $2 to purchase £1...

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