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    Principles of Macroeconomics Study Set 8
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    Exam 18: Open Economy Macroeconomics Basic Concepts: A First Theory of Exchange-Rate Determination Purchasing-Power Parity
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    Purchasing-Power Parity Implies That the Nominal Exchange Rate Given as Foreign
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Purchasing-Power Parity Implies That the Nominal Exchange Rate Given as Foreign

Question 79

Question 79

Multiple Choice

Purchasing-power parity implies that the nominal exchange rate given as foreign currency per unit of U.S.currency must rise if the price level(s) in


A) foreign countries rise.
B) the United States rises.
C) all countries rise.
D) all countries fall.

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