If Purchasing Power Parity Holds Between the U

question 142

Multiple Choice

If purchasing power parity holds between the U.S. and China:

• A) the real exchange rate must be 1.
• B) the nominal exchange rate must be 1.
• C) the U.S. must no longer have a trade deficit.
• D) China must no longer have a trade deficit.

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An island country located in East Asia, known for its rich culture, technological advancements, and historic landmarks.

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