The Empirical Evidence on Purchasing Power Parity Seems to Point

Multiple Choice

The empirical evidence on purchasing power parity seems to point out that:

A) The higher a country's inflation rate, the greater is the appreciation in the country's currency
B) The theory of purchasing power parity cannot explain long-run changes in exchange rates
C) The higher a country's inflation rate the greater is the depreciation in the country's currency
D) There isn't any clear link between inflation rates and exchange rates