Which of the Following Does Purchasing-Power Parity Imply

question 55

Multiple Choice

Which of the following does purchasing-power parity imply?

• A)The purchasing power of the dollar is the same in the U.S.as in foreign countries.
• B)The price of domestic goods relative to foreign goods cannot change.
• C)The nominal exchange rate is the ratio of U.S.prices to foreign prices.
• D)All of the above are correct.

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