Question: Question 2 5 points Saved Suppose it is January 1 2019. The price level in U.S. is USD10,000, the price level in the U.K. is

Question 2 5 points Saved Suppose it is January 1 2019.

Question 2 5 points Saved Suppose it is January 1 2019. The price level in U.S. is USD10,000, the price level in the U.K. is GBP75,000, and the spot exchange rate is GBP1.01/USD. Suppose that the rate of U.S. inflation during 2019 is 8%, the rate of U.K. Inflation during 2019 is 2%, and the spot exchange rate on December 31, 2019 is GBP/USD. What is the magnitude of the real depreciation of the British Pound (GBP) relative to the U.S. dollar? a. real depreciation of GBP is 3.82% O b.real depreciation of GBP is 1.89% c. real depreciation of GBP is 6.49% d. real depreciation of GBP is 4.61%

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