​Which of the Following Theories Suggests That the Percentage Change

question 7

Multiple Choice

​Which of the following theories suggests that the percentage change in the spot exchange rate of a currency should be equal to the inflation differential between two countries?

• A) ​purchasing power parity (PPP)
• B) ​triangular arbitrage
• C) ​international Fisher effect (IFE)
• D) ​interest rate parity (IRP)

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Definitions:

Intravascular Fluid

Fluid within the blood vessels, including blood plasma and other components, important for maintaining blood pressure and volume.

KCl

Potassium chloride, a metal halide salt used in medicine, food processing, and scientific applications, often for treating potassium deficiencies.

Metabolic Acidosis

A condition characterized by an excess of acid in the body due to either increased acid production or decreased acid excretion.

Hyperglycemia

A condition characterized by an excessively high level of glucose in the blood.