Suppose Purchasing Power Parity Exists in the Car Stereo Market

question 104

Multiple Choice

Suppose purchasing power parity exists in the car stereo market in the United States and Australia. If a car stereo costs $230 in the United States and the exchange rate is $1 = $AUD₁.67, the same car stereo may be purchased in Australia for approximately:

• A) $AUD 138.
• B) $AUD 230.
• C) $AUD 2,300.
• D) $AUD 384.
• E) $AUD 108.

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Definitions:

Test-retest Reliability

The consistency of a measure evaluated by testing the same individuals at two different points in time and comparing the scores.

NCE Type Scores

NCE Type Scores, or Normal Curve Equivalent scores, are standardized test scores that range from 1 to 99, representing a test taker's position relative to a norming group on a normal curve.

Internal Consistency

A measure of the reliability of a test or scale; assessing if various items that propose to measure the same general construct produce similar scores.

Licensure Exam

A licensure exam is a standardized test that individuals must pass to receive a professional license in a specific field or occupation.