Q4,5&6 thanks!!

4. Proponents of the PPP theory argue that price, and exchange rates should move in a similar fashion because a. When goods and services become temporarily ment expensive in one country than In others, the demands for his currency and its producty fall pushing for an appreciation. b. When goods and services become temporarily cheaper in one country than in others, the demands for its currency and its products rise, pushing for an appreciation. c. When goods and services become temporarily more expensive in one country than in others, the demands for its currency and its products rise, pushing for a depreciation. d. When goods and services become temporarily cheaper in one country than in others, the demands for its currency and its products full, pushing for an appreciation, 5. Which of the following would NOT violate the PPP theory of exchange rates? a. Since education is non-tradable, it is impossible for differences in schooling prices to be evened out by international trade. b. A Mercedes car sells for a higher price in France than in Italy. c. Asian populations consume very little dairy products and hence a rise in the world price of milk would affect the Belgian price level more than that of Thailand. d. Expansionary monetary policy causes higher inflation and a currency depreciation. 6. By the interest parity condition, the difference between nominal Interest rates equals the expected rate of depreciation By the relative PPP, the expected rate of depreciation between two currencies equals the inflation differential between two markets. Combining these two gives us the Fisher effect which implies that if the Turkish inflation were to rise permanently from a constant level of 6% to 10% per year, while US inflation remained constant at 1% TL interest rates would eventually catch up with higher inflation, rising by 4 percentage points per year from their initial level. b, the real return on Turkish assets would remain unchanged. c. the nominal interest difference between Turkey and US must equal 9% d. (b) and (0) are correct. e. (a), (b) and (c) are correct