when the real exchange rate is larger than one, it means that group of answer choices the domestic country is more competitive. the domestic country is experiencing high inflation. the domestic country is experiencing high interest rates. the domestic country is experiencing higher purchase power. none of the options.

The weighted average of the currencies of a country's main trading partners is used to calculate the real effective exchange rate (REER), which contrasts the value of a country's currency.
It serves as a gauge of a country's ability to compete internationally with its trading partners.
The weighting factor accounts for the relative significance of each trading partner to the home country.
A rising REER is a sign that a nation is losing its competitive advantage.
A country's nominal effective exchange rate (NEER), when accounting for domestic inflation, is equal to its real effective exchange rate.
The average of the bilateral exchange rates between a country and its trading partners is used to calculate REER, which is then weighted to account for the relative importance of each trading partner.

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