Calculate the real exchange rate at the beginning of year, Finance Basics

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Calculate the real exchange rate at the beginning of year

Problem

The exchange rate at the beginning of the year was SF1.0000/$. The price level of a typical consumption basket in Switzerland was SF120/SFCB and the price level of a typical consumption basket in the United States was also $100/$CB at the beginning of the year. Calculate the real exchange rate at the beginning of the year.

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Finance Basics: Calculate the real exchange rate at the beginning of year

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Finance Basics: Calculate the real exchange rate at the beginning of year

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