Suppose that a Swiss television set that costs 400 francs in Switzerland cost $200 in the United States. The exchange rate between the franc and the dollar is ?
Correct answer: A. 2 francs per dollar
- A. 2 francs per dollar
- B. 1 franc per dollar
- C. $2 per franc
- D. $3 per franc
Explanation
If 400 francs equal 200 dollars, dividing both sides by 200 gives 2 francs per dollar. Equivalently, one franc is worth 50 cents.
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The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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