Assuming the Theory of Purchasing Power Parity Holds, If the Exchange

question 62

Multiple Choice

Assuming the theory of purchasing power parity holds, if the exchange rate between the United States and Japan is $0.011 per yen ¥) , then how much does a $400 Microsoft Xbox cost in Japanese yen?

• A) ¥27,273
• B) ¥31,818
• C) ¥36,364
• D) ¥44,000
• E) ¥46,467

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Definitions:

Disparities

Inequalities or differences, often in the context of social, economic, or health outcomes among different populations.

Wealth

An abundance of valuable material possessions or resources, including money, property, and other assets.

Institutionalized

The process of establishing something as a norm or standard within a structured system or organization, often associated with formal rules and conventions.

Superiority of Reason

The belief that reason and logical thinking are the highest means of understanding or solving problems, superior to emotion or faith.