Why Does Purchasing-Power Parity Theory NOT Hold at All Times

question 188

Multiple Choice

Why does purchasing-power parity theory NOT hold at all times?

• A) because countries use different currencies
• B) because wages are higher in some countries and lower in others
• C) because some goods and services cannot be traded
• D) because prices are different across countries

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Definitions:

Power

Power refers to the ability or capacity to influence, control, or direct the behavior of others or the course of events.

Self-Disclosure

The revelation of personal information that others would not ordinarily know because of its riskiness.

Commitment

The state or quality of being dedicated to a cause, activity, or relationship, often implying a long-term engagement or obligation.

Caring

Making another’s needs as important as one’s own.