A Hamburger Costs C$4

Multiple Choice

A hamburger costs C$4.50 in Fredericton, New Brunswick, and the exchange rate is 67 U.S. cents per Canadian dollar. Then the

A) hamburger will cost US$4.50 if purchasing power parity holds.
B) Canadian dollar is expected to depreciate according to purchasing power parity.
C) Canadian dollar is expected to appreciate according to purchasing power parity.
D) hamburger will cost US$3.00 if purchasing power parity holds.
E) hamburger will cost US$3.00 if rate of return parity holds.