When the purchasing power of currencies is the same,
A) interest parity holds.
B) currencies cannot change in value
C) the real exchange rate is equal to the nominal exchange rate.
D) interest rates are the same.
Question 2
Which of the following is a problem that arises when trying to classify regional trade agreements?
A) Many agreements combine elements from different categories.
B) The definition of free trade area includes that of a customs union.
C) Some agreements include cultural issues while others do not.
D) The most favored nation clause includes all of them.
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