Suppose the U.S. price level is 150, the German price level is 450, and the Swiss price level is 600. If exchange rates are 3 euros/dollar and 4 francs/dollar, then purchasing power parity ________ between Germany and the United States and ________ between Switzerland and the United States.
A) holds; does not hold
B) does not hold; holds
C) holds; holds
D) does not hold; does not hold
Correct Answer:
Verified
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