If the Regression Analysis of the Relationship Between Exchange Rates

question 88

Multiple Choice

If the regression analysis of the relationship between exchange rates and changes in the factor inflation has the coefficient 0.85,this suggests:

• A) a negative relationship between the exchange rate and inflation.
• B) that the theory of purchasing power parity (PPP) does not hold.
• C) positive support for the theory of PPP.
• D) that the relationship is not clear.

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