If a Commodity Costs the Same Regardless of the Currency

question 61

Multiple Choice

If a commodity costs the same regardless of the currency used to purchase it or the country where it is sold, then _________________.

• A) Forward exchange rates are equal.
• B) Interest rate parity holds.
• C) Relative purchasing power parity holds.
• D) Uncovered interest rate parity holds.
• E) Absolute purchasing power parity holds.