| Question |
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| a. Compute the percentage change from 2009 to 2010 in the four U.S. bilateral exchange rates (defined as U.S. dollars per unit of foreign exchange, or FX) in the table provided. b. Use the trade shares as weights to compute the percentage change in the nominal effective for the United States between 2009 and 2010 (in U.S. dollars per foreign currency basket). c. Based on your answer to (b), what happened to the value of the U.S. dollar against this basket between 2009 and 2010? How does this compare with the change in the value of the U.S. dollar relative to the Mexican peso? Explain your answer. |
