State Whether There Is One Way for the Given Observation

question 23

Multiple Choice

state whether there is one way for the given observation to occur (outcome) or more than one way for the given observation to occur (in which case it is an event) .
-Tossing two tails with two fair coins

• A) Outcome
• B) Event

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Definitions:

Absolute Purchasing Power Parity

A theory that suggests that in the absence of trade barriers and transportation costs, identical goods will have the same price in different countries when prices are expressed in a common currency.

Covered Interest Arbitrage

A financial strategy to profit from the difference in interest rates between two countries while hedging against exchange rate risks.

Spot Rate

The current market price at which a particular asset, such as a currency, commodity, or security, can be bought or sold for immediate delivery.

Relative Purchasing Power Parity

Relative Purchasing Power Parity (RPPP) is an economic theory which postulates that the rate at which the exchange rate between two currencies will change over time is equivalent to the rate at which their purchasing power converges, essentially due to inflation rates differences.