Two homogeneous products from Germany and Brazil are being purchased by an American trader.The product from Germany is cheaper than the product from Brazil.According to ________,the trader will purchase the products from Germany until the increased demand for the German product equalizes the price.
A) Arbitrage
B) Purchasing power parity
C) Law of one price
D) Exchange rate arbitrage
Correct Answer:
Verified
Q21: The _ states that two identical products
Q22: According to relative purchasing power parity,if the
Q23: Low _ for homogeneous commodities,such as oil,lets
Q24: As long as the flow of currencies
Q25: According to relative purchasing power parity,if Belgian
Q27: If the price of wheat is $25/bushel
Q28: According to the theory of purchasing power
Q29: _ exports can be caused by a(n)_
Q30: Which of the following is NOT true
Q31: The foreign exchange market is _ and
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