Calculate the real exchange rate

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Consider the following data on USDMXN and price levels in the United States and Mexico. Calculate the real exchange rate at t=0.

            Price Level (P)            

Year     USDMXN        Mexico            United States    Real Exchange (q)

-3         13.00               100                              100                  ?

-2         13.50               105                              102                  ?

-1         14.00               111                              104                  ?         

  0        14.50               116                              107                  ?

Reference no: EM13809637

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