Suppose Absolute Purchasing Power Parity Holds

question 186

Multiple Choice

Suppose absolute purchasing power parity holds. The exchange rate between British pounds and Canadian dollars is £0.4825 per dollar. If a computer costs $2,995 in Canada, how much should it
Cost in Britain?

• A) £1,180
• B) £1,445
• C) £1,576
• D) £2,995
• E) £6,207