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Please answer the following questions in at least 500 words per part. Q1: a. Discuss the role of parity conditions in analyzing price and interest

Please answer the following questions in at least 500 words per part.

Q1:

a. Discuss the role of parity conditions in analyzing price and interest rate convergence in an international setting?

b. What do your considerations imply for the usefulness of an exchange rate peg as an inflation anchor?

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