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The implied (equilibrium) PPP rate of exchange of the Canadian dollar per U.S. dollar is C$.9913/$ according to the Big Mac Index. The current exchange
The implied (equilibrium) PPP rate of exchange of the Canadian dollar per U.S. dollar is C$.9913/$ according to the Big Mac Index. The current exchange rate is C$1.2785/$. Thus, according to PPP and the Law of One Price, at the current exchange rate the U.S. dollar is overvalued by 22.46% undervalued by 22.46 None of the answers is correct undervalued by 28.97% overvalued by 28.97% Assume the CPI index in Canada was 105 last year and 107.3 this year, what was the exact inflation this year? 107.3% 2.30% 2.14% 2.19% None of the answers are correct
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