The inflation rate in the United States is 10 percent, while the inflation rate in Japan is 3 percent. The current exchange rate for the Japanese yen (¥) is $0.0085. After supply and demand for the Japanese yen have adjted according to purchasing power parity, the new exchange rate for the yen will be:
a. None of these are correct.
b. $0.0078.
c. $0.00492.
d. $0.0111.
e. $0.0091