Suppose Purchasing Power Parity Holds

question 8

Multiple Choice

Suppose purchasing power parity holds.If in 1997 the price level in the United States is 100,the price level in Japan is 10,000,and the nominal exchange rate is 100 yen per dollar,while in 1998 the price level in Japan rises to 10,500 and the nominal exchange rate rises to 105,then the price level in the United States in 1998 must be

• A)95.
• B)100.
• C)105.
• D)110.25.

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Definitions:

Medicine

The science and practice of diagnosing, treating, and preventing diseases and maintaining health through various interventions and pharmaceuticals.

Positive Reinforcer

A stimulus that, when presented after a response, increases the likelihood of that response being repeated.

Negative Reinforcer

An unpleasant or aversive stimulus that, when removed or avoided following a behavior, increases the likelihood of that behavior being repeated.

Delicious Food

Food that is highly pleasing to the taste, often characterized by rich flavors and textures.