_____ is a statement concerning prices and percentage changes in exchange rates over time.
A) The law of one price
B) Absolute PPP
C) Relative PPP
D) Real PPP
E) Relative PPI

Question

Quizplus · Accepted Answer

Relative Purchasing Power Parity (PPP) deals with the rate of change in prices between two countries and how this affects their exchange rate over time. It's a dynamic concept that looks at percentage changes in price levels and exchange rates, unlike Absolute PPP which focuses on the static comparison of price levels for the same basket of goods in two countries.

_____ Is a Statement Concerning Prices and Percentage Changes in Exchange