Real exchange rate: Difference between revisions
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The value of a currency in terms of real purchasing power. | The value of a currency in terms of real purchasing power. | ||
It is calculated by comparing the price of a hypothetical market basket of goods in two different countries, translated into the same currency at the prevailing exchange rate. | It is calculated by comparing the price of a hypothetical market basket of goods in two different countries, translated into the same currency at the prevailing exchange rate. | ||
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== See also == | == See also == | ||
* [[Currency]] | |||
* [[Exchange rate]] | * [[Exchange rate]] | ||
* [[Real]] | |||
[[Category:Manage_risks]] | |||
Latest revision as of 23:46, 11 March 2023
The value of a currency in terms of real purchasing power.
It is calculated by comparing the price of a hypothetical market basket of goods in two different countries, translated into the same currency at the prevailing exchange rate.
It is useful in measuring the price competitiveness of domestic goods in international markets.
