If Purchasing-Power Parity Holds,when a Country's Central Bank Increases the Money

question 6

Multiple Choice

If purchasing-power parity holds,when a country's central bank increases the money supply,a unit of money

• A)gains value both in terms of the domestic goods and services it can buy and in terms of the foreign currency it can buy.
• B)gains value in terms of the domestic goods and services it can buy,but loses value in terms of the foreign currency it can buy.
• C)loses value in terms of the domestic goods and services it can buy,but gains value in terms of the foreign currency it can buy.
• D)loses value both in terms of the domestic goods and services it can buy and in terms of the foreign currency it can buy.

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Definitions:

Lipid

A group of naturally occurring molecules that include fats, waxes, sterols, fat-soluble vitamins (such as vitamins A, D, E, and K), monoglycerides, diglycerides, triglycerides, phospholipids, and others.

Kcal/g

A unit of energy measurement indicating the number of kilocalories per gram, used in the context of food energy content.

Energy

The capacity to do work or produce change, existing in various forms such as kinetic, thermal, electrical, chemical, nuclear, or other forms.

Protein

Essential macronutrients made of amino acids, crucial for building and repairing tissues, making enzymes, and supporting immune function.