According to Purchasing-Power Parity Theory,if the Same Fast-Food Hamburger Costs

question 62

Multiple Choice

According to purchasing-power parity theory,if the same fast-food hamburger costs $2.50 in Canada and 10 Tunisian dinars,what should the exchange rate be?

• A)1/4 Tunisian dinars per dollar
• B)1 Tunisian dinar per dollar
• C)4 Tunisian dinars per dollar
• D)25 Tunisian dinars per dollar

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Definitions:

GDP Deflator

An economic metric that converts output measured at current prices into constant-dollar GDP, removing the effect of inflation.

Prices Rising

An economic scenario where the general level of prices for goods and services is increasing over time, often referred to as inflation.

CPI

A gauge called the Consumer Price Index assesses the weighted average price shifts in a collection of consumer products and services, encompassing areas like food, healthcare, and transportation.

Economists

Professionals who study the production, distribution, and consumption of goods and services, often focusing on research, analysis, and the development of economic theories.