Author Question: Purchasing power parity suggests that the exchange rate between two currencies reflects differences ... (Read 115 times)

fbq8i · **on:** Jun 29, 2018

Purchasing power parity suggests that the exchange rate between two currencies reflects differences in the overall price levels in the two countries.

Indicate whether the statement is true or false

Question 2

A consequence of hyperinflation is that people

A) increase the quantity of money demanded.
B) receive higher real wage hikes, which increases their purchasing power for goods and services.
C) who make fixed-payment loans to others receive higher payments as inflation increases.
D) spend time trying to keep their money holdings near zero.
E) want to lend funds because interest rates are so high.