The article, "The international value of
the dollar: An inflation-adjusted index" in the
January/February 1987 issue of Economic Persbectives'
contained an error in the formulation
of the equation that specified the inflationadjusted
aggregate exchange rate of the dollar.
As formula (1) is specified on page 2 1, the relative
prices term is inverted. The correction is
as follows: The ratio of the CPI for the United
States to the CPI for country i is used to
measure the relative movement of prices in the
United States as com~aredw ith the movement
of prices in country i.