Purchasing power parity can be used as
A) an indicator of how interest rates will change in the long run.
B) a short-term and long-term gauge of relative currency values.
C) an indicator of how interest rates will change in the short run.
D) a long-run gauge,but in the short run large deviations in currency values can exist.
E) a short-term gauge,but in the long run large deviations in currency values can exist.
Correct Answer:
Verified
Q63: The exchange rate is volatile because
A) the
Q65: An increase in the Australian interest rate
Q66: Q68: Purchasing power parity determines the exchange rate Q69: When the Australian interest rate rises, the Q71: If the interest rate on a bank Q129: If the Australian interest rate differential falls,then Q130: Purchasing power parity is defined as Q131: In the long run,the exchange rate between Q138: Assume the exchange rate is 1 Australian
A)a constant
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