Based on the purchasing power parity theory,currencies of countries with higher inflation relative to other countries will tend to ____________ in the long run.

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According to purchasing power parity theory, currencies of countries with higher inflation relative to other countries will tend to depreciate in the long run. This is because inflation erodes the value of a currency, making it less valuable compared to currencies of countries with lower inflation rates. As a result, goods and services in the high inflation country will become relatively more expensive, leading to a decrease in demand for its currency and a fall in its exchange rate.

Based on the Purchasing Power Parity Theory,currencies of Countries with Higher