If the Exchange Rate Between the Canadian Dollar and the Indian

question 186

Multiple Choice

If the exchange rate between the Canadian dollar and the Indian rupee (rupees per dollar) is greater than the relative purchasing power between the two countries, which of the following would be true?

• A)There are opportunities for profit by purchasing goods in India and then selling them in Canada.
• B)Purchasing power parity predicts that the value of the dollar will rise as traders take advantage of arbitrage opportunities.
• C)Purchasing power parity predicts that the dollar is undervalued as traders take advantage of arbitrage opportunities.
• D)There are no arbitrage opportunities for which traders can take advantage.
• E)Indian workers are more productive than Canadian workers.

---

Definitions:

Preinteraction

A phase in any relationship or interaction where initial perceptions are formed before direct contact occurs.

Communication Aids

Tools and devices designed to assist individuals who have difficulties with verbal communication.

Speak Loudly

Raising the volume of one's voice to ensure audibility or to convey emphasis.

Eye Contact

The act of looking directly into another person's eyes, which can communicate various emotions or intent and is an important aspect of non-verbal communication.