The Mexican peso’s exchange rate relative to the US$ moved from 10 pesos = 1 US$ to 9 pesos = 1 US$. In the same time span, Mexico’s general price level decreased by 10% while the US price level stayed unchanged. How did the nominal and real exchange rate of the peso against the US$ change?
- Anominal peso exchange rate appreciated; real peso exchange rate appreciated
- Bnominal peso exchange rate appreciated; real peso exchange rate unchanged
- Cnominal peso exchange rate depreciated; real peso exchange rate depreciated
- Dnominal peso exchange rate depreciated; real peso exchange rate unchanged