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    International Economics Study Set 1
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    Exam 12: Exchange Rate Determination
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    The Purchasing- Power-Parity Theory Predicts That If the U
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The Purchasing- Power-Parity Theory Predicts That If the U

Question 118

Question 118

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The purchasing- power-parity theory predicts that if the U.S.inflation rate exceeds the Japanese inflation rate by 4 percent,the dollar's exchange value will appreciate by 4 percent against the yen.

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