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If a Dollar Bought 1,000 Chilean Pesos Ten Years Ago

Question 19

Multiple Choice

If a dollar bought 1,000 Chilean pesos ten years ago and 1,500 lire now, and inflation for that period was 25 percent in the United States and 100 percent in Chile, then:


A) the purchasing-power parity theory is correct.
B) traveling in Chile today costs about the same as it did ten years ago.
C) traveling in Chile is cheaper now than it was ten years ago.
D) traveling in Chile is more expensive now than it was ten years ago.

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