Absolute Purchasing Power Parity Means

question 32

Multiple Choice

Absolute purchasing power parity means:

• A)the quantity of goods that can be bought in the home country is greater than the quantity of goods that can be bought in the foreign country.
• B)buying and selling goods looks equally attractive in both countries.
• C)the nominal exchange rate is the ratio of the foreign price to the world price.
• D)all of the above.

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