If People Expect Relative PPP to Hold

question 1

Multiple Choice

If people expect relative PPP to hold

• A) the difference between the interest rates offered by dollar and euro deposits will equal the difference between the inflation rates expected, in the United States and Europe, respectively, over the relevant horizon.
• B) the difference between the interest rates offered by dollar and euro deposits will equal the difference between the inflation rates expected in Europe and the United States, respectively.
• C) the difference between the interest rates offered by dollar and euro deposits will equal the difference between the inflation rates expected, over the relevant horizon, in the United States and Europe, respectively, in the short run.
• D) the difference between the interest rates offered by dollar and euro deposits will be above the difference between the inflation rates expected, over the relevant horizon, in the United States and Europe, respectively.
• E) the difference between the interest rates offered by dollar and euro deposits will be below the difference between the inflation rates expected, over the relevant horizon, in the United States and Europe, respectively.

Understand the similarities and differences between CPFR (Collaborative Planning, Forecasting, and Replenishment) and S&OP (Sales and Operations Planning) processes.

Identify logistical problems that can arise from misalignment between supply and demand and discuss methods to mitigate these effects.

Understand and differentiate between various forecast error measures.

Identify and describe different forecasting methods, including their advantages and disadvantages.

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