According to the Purchasing-Power-Parity Theory,the U

question 60

Multiple Choice

According to the purchasing-power-parity theory,the U.S.dollar maintains its purchasing-power parity if it depreciates by an amount equal to the excess of:

• A) U.S.interest rates over foreign interest rates
• B) Foreign interest rates over U.S.interest rates
• C) U.S.inflation over foreign inflation
• D) Foreign inflation over U.S.inflation

---

Definitions:

Double Taxation

The imposition of two or more taxes on the same income, asset, or financial transaction.

Limited Liability

A legal structure that limits the financial responsibility of the owners or shareholders of a company to the amount they have invested in the company.

Partnerships

A lawful business arrangement involving two or more people who divide both the management responsibilities and the earnings.

Residual Income Claimants

Individuals or entities entitled to the income that remains after all other expenses and obligations have been met, typically referring to owners or shareholders.