Question
In Feb 2022 the euro/dollar exchange rate was 0.88. in France, country that uses euro as currency, average price of the game monopoly was euro22,
In Feb 2022 the euro/dollar exchange rate was 0.88. in France, country that uses euro as currency, average price of the game monopoly was euro22, while in US that uses dollar as currency the average price was dollar 25. From this information we get that:
a) exchange rate is too low. The euro should appreciate to ensure that purchasing power parity holds.
b) exchange rate is too low. The dollar should appreciate to ensure that purchasing power parity holds.
c) exchange rate is too high. The euro should appreciate to ensure that purchasing power parity holds.
d) exchange rate is too high. The dollar should appreciate to ensure that purchasing power parity holds.
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Auditing Cases An Active Learning Approach
Authors: Mark S. Beasley, Frank A. Buckless, Steven M. Glover, Douglas F. Prawitt
2nd Edition
0130674842, 978-0130674845
