This topic contains a solution. Click here to go to the answer

Author Question: The reason relative purchasing power parity (RPPP) is better at predicting exchange rates than ... (Read 108 times)

amal

  • Hero Member
  • *****
  • Posts: 572
The reason relative purchasing power parity (RPPP) is better at predicting exchange rates than absolute purchasing power parity (APPP) is because:
 a. Actually, it is the other way around. APPP has been shown empirically and theoretically to be a more accurate way to predict exchange rates.
  b. APPP deals only with countries that have some sort of imbalance like hyperinflation. RPPP deals with any and all countries, which makes the job of predicting exchange rates easier.
  c. APPP has to begin and end in parity. RPPP just requires that the initial disequilibrium remain the same.
  d. APPP predictions are often biased because of central bank controls, sticky prices, and protectionism. RPPP can abstract from these problems.

Question 2

The nominal, effective exchange rate is the:
 a. Nominal, effective exchange rate adjusted for a nation's price level relative to many foreign countries' prices.
  b. Value of one currency in terms of another currency.
  c. Weighted-average value of a currency relative to many foreign currencies.
  d. Nominal, bilateral exchange rate adjusted for the international price levels of the two countries.



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Bsand8

  • Sr. Member
  • ****
  • Posts: 327
Answer to Question 1

.C

Answer to Question 2

.C




amal

  • Member
  • Posts: 572
Reply 2 on: Jun 30, 2018
Great answer, keep it coming :)


TheNamesImani

  • Member
  • Posts: 334
Reply 3 on: Yesterday
:D TYSM

 

Did you know?

Cucumber slices relieve headaches by tightening blood vessels, reducing blood flow to the area, and relieving pressure.

Did you know?

There are actually 60 minerals, 16 vitamins, 12 essential amino acids, and three essential fatty acids that your body needs every day.

Did you know?

Though Candida and Aspergillus species are the most common fungal pathogens causing invasive fungal disease in the immunocompromised, infections due to previously uncommon hyaline and dematiaceous filamentous fungi are occurring more often today. Rare fungal infections, once accurately diagnosed, may require surgical debridement, immunotherapy, and newer antifungals used singly or in combination with older antifungals, on a case-by-case basis.

Did you know?

The strongest synthetic topical retinoid drug available, tazarotene, is used to treat sun-damaged skin, acne, and psoriasis.

Did you know?

Patients who cannot swallow may receive nutrition via a parenteral route—usually, a catheter is inserted through the chest into a large vein going into the heart.

For a complete list of videos, visit our video library