This approach is quite arbitrary because the exchange rate is determined simply by the supply and demand for currency and these metrics are greatly dependent on the volumes of trade balances. It makes little (or no) sense to value all goods (both traded and non-traded at the nominal exchange rate, especially since the absolute volumes of trades may be small compared to total output in both countries.
This approach is highly arbitrary as the exchange rate is solely determined by currency supply and demand, metrics that are significantly impacted by trade balance volumes. It does not make much (if any) sense to value all goods (both traded and non-traded using nominal exchange rates, especially since the actual trade volumes might be small compared to total output in both countries.