What Is Required for Absolute Purchasing Power Parity to Hold

question 14

Essay

What is required for absolute purchasing power parity to hold?
Do you think absolute PPP would hold in the case where a computer retailer in the U.S. sits directly across the border from a computer retailer in Canada?
How about Houston,Texas,and Winnipeg,Manitoba?

---

Definitions:

Security Interest

A legal claim or lien on collateral that secures the repayment of a debt or obligation, giving the lender rights in the collateral.

Secured Party

The party that holds the interest in a secured property.

Uniform Commercial Code

A comprehensive set of laws governing all commercial transactions in the United States, intended to harmonize the law of sales and other commercial transactions across American jurisdictions.

Purchase-Money Security Interest (PMSI)

A security interest formed when a debtor uses borrowed money from the secured party to buy the collateral.