For absolute purchasing power parity to exist, forward exchange rates must equal the spot rates

Name: For absolute purchasing power parity to exist, forward exchange rates must equal the spot rates
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Question

Quizplus · Accepted Answer

Absolute purchasing power parity focuses on the idea that identical goods in different countries should have identical prices when expressed in a common currency, which is independent of the relationship between forward and spot exchange rates.

For Absolute Purchasing Power Parity to Exist, Forward Exchange Rates