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If Purchasing Power Parity Holds, Then the Fisher Effect Must

question 7

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If purchasing power parity holds, then the Fisher effect must also hold.


Definitions:

Representation Heuristic

A cognitive shortcut that involves making a decision based on how much something resembles a typical case.

Error

A mistake or inaccuracy in action, calculation, opinion, or judgment caused by poor reasoning or misunderstanding.

Judgment

The ability to make considered decisions or come to sensible conclusions.

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