Let P$ Be the U $\times$ Be the Price of the Same Basket of Goods in Particular

Multiple Choice

Let P$ be the U.S.dollar price of a basket of particular goods and P $\times$ be the price of the same basket of goods in Japanese yen.The PPP theory predicts that the dollar/yen exchange rate,E_{$/ $\times$} ,should be equivalent to:

A) (1+P $\times$ ) /P$.
B) (1 + P$) /P $\times$ .
C) P $\times$ /P$.
D) P$/P $\times$ .