What Does Purchasing-Power Parity Explain

question 17

Multiple Choice

What does purchasing-power parity explain?

• A) It explains prices in the short run.
• B) It explains prices in the long run.
• C) It explains exchange rates in the short run.
• D) It explains exchange rates in the long run.

---

Definitions:

Mum Effect

The reluctance to communicate unfavorable information or feedback due to the fear of the negative consequences that may result, leading to a lack of communication or withholding of important information.

Mum Effect

The reluctance to communicate unfavorable news or feedback, often to avoid discomfort or conflict.

Voice

The expression of opinions or the ability to express one's thoughts and concerns in an organization or group setting.

Voice

The ability or opportunity to express opinions, concerns, or suggestions in order to influence decisions within an organization or group.