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Question 4 (1 point) Which of the following is TRUE according to the theory of Purchasing Power Parity (PPP)? Purchasing Power Parity helps explain the

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Question 4 (1 point) Which of the following is TRUE according to the theory of Purchasing Power Parity (PPP)? Purchasing Power Parity helps explain the reasons for the short term (eg. day to day) fluctuations of foreign exchange rates. Purchasing Power Parity explains how speculative capital flows affect exchange rates. O Exchange rates will adjust so that the price of a basket of similar goods, services & investments is about the same in each country. Exchange rates do not adjust to the prices of similar goods, services & investments in each country

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