Two Identical Items Are Manufactured in Both Australia and the USA.Using

question 98

Multiple Choice

Two identical items are manufactured in both Australia and the USA.Using your knowledge of the purchasing power parity theory and the following data,forecast the AUD/USD exchange rate in years 2 and 3. $$\begin{array} { | l | l | l | l | } \hline & \text { Price (AUD) } & \text { Price (USD) } & \text { AUD/USD } \\\hline \text { Year 1 } & \$ 17.50 & \$ 13.60 & 0.7680 \\\hline \text { Year 2 } & \$ 19.25 & \$ 14.28 & ? \\\hline \text { Year 3 } & \$ 19.25 & \$ 14.99 & ? \\\hline\end{array}$$

• A) 0.7296 and 0.7661
• B) 0.8064 and 0.7661
• C) 0.8064 and 0.8467
• D) 0.8448 and 0.8870

---

Definitions:

Self-Disclosure

The act of revealing personal information about oneself to others, fostering intimacy and trust in relationships.

Grave-Dressing Processes

Psychological strategies employed by individuals post-breakup to justify, rationalize, or cope with the end of a relationship.

Breakdown Processes

Mechanisms or series of events that lead to the failure or disintegration of structures or systems.

Social Processes

Patterns of interaction between individuals and groups that order and structure the social world.