Question
Based solely on purchasing power parity (PPP), calculate the expected one-year inflation rate in the U.S. if the Canadian inflation rate is expected to be
Based solely on purchasing power parity (PPP), calculate the expected one-year inflation rate in the U.S. if the Canadian inflation rate is expected to be 3.5% next year and the one-year forward rate if a Canadian dollar is USD$.75/CAD$1. current exchange is usd$.74/cad$1
the answer given to this problem on this site is 38% how is the US infation rate 38% when the cdn one is 3.5????
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Managerial Economics A Problem-Solving Approach
Authors: Luke M. Froeb, Brain T. Mccann
2nd Edition
B00BTM8FK0
