The purchasing power parity theorem states that the real purchasing power of money should be approximately the same

Question

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The purchasing power parity (PPP) theorem suggests that the real purchasing power of a currency should be the same across different countries, meaning that the same amount of currency should be able to buy the same basket of goods and services in each country. This would indicate that exchange rates between currencies should adjust to reflect differences in inflation rates between countries. Therefore, regardless of the country in which the money is spent, it should have the same purchasing power if the PPP holds true.

The Purchasing Power Parity Theorem States That the Real Purchasing