5. Purchasing power parity Aa Aa The law of one price The theory of purchasing power parity (PPP) states that in the long-run exchange rates between two countries adjusts so that the price of an identical good is the same when expressed in the same currency. A gaming console costs 175.23 in England. The spot rate is currently $1.9472 per pound. Assuming that PPP holds true, what is the price of the gaming TUALears console in the United States? 30378 $358.27 $341.21 3330370 $98.99 $375.33 ONTWIE Suppose the price of the gaming console in the United States was actually $375.33. Assuming no transaction costs, transportation costs, or import restrictions, what does PPP predict would happen to the demand for the gaming console in the United States? The demand for the gaming console would decrease in the United States. The demand for the gaming console would increase in the United States