-Assume That the Information in Table 19-1 Applies to the Cost

question 170

Multiple Choice

-Assume that the information in Table 19-1 applies to the cost per ton of coal in 1998.Assume that also over a 10-year period prices rise 100 percent in Great Britain and 200 percent in the United States.According to the purchasing power parity theory, the exchange rate between the dollar and the pound in the year 2008 will be

• A)one dollar = two pounds.
• B)one pound = two dollars.
• C)one pound = three dollars.
• D)one dollar = three pounds.

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Definitions:

Purchase-Money Security Interest

A legal claim or lien on property that secures payment of the price or an obligation incurred for the property's purchase.

Consumer Good

A good used or bought for use primarily for personal, family, or household purposes.

Financial Statement

A formal record of the financial activities and position of a business, individual, or other entity, typically detailing income, assets, liabilities, and equity at a specific point in time.

Default

Failure to make payments on a loan.