2 Assume that the prices of a standard basket of goods and services in different countries are as follows United States $400 Canada C$550 United Kingdom £280 Japan ¥60,000 a What are the implied PPP exchange rates?
b How would the presence of a high sales tax in Britain, such as the VAT, influence your guess of where the actual value of S($/£) would be vis a` vis the PPP value of S($/£)?