The idea that similar foreign and domestic goods,or baskets of goods,should have the same price when priced in terms of the same currency is called
A)equity.
B)purchasing power parity.
C)efficiency.
D)the tragedy of the commons.

Question

Quizplus · Accepted Answer

Purchasing power parity (PPP) is the economic theory that suggests that the exchange rate between two countries should be such that the goods and services offered by both countries cost the same when expressed in the same currency. This concept helps to ensure that there is no advantage in buying goods from one country versus another once the effects of currency exchange have been taken into account.

The Idea That Similar Foreign and Domestic Goods,or Baskets of Goods,should