The PPP hypothesis implies that the real exchange rate must be equal to which of the following?
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Question:
The PPP hypothesis implies that the real exchange rate must be equal to which of the following? Select all that apply.
a) 1
b) eP*/P, where P is the aggregate price level in home country, P* in foreign country
c) P*/P, where P is the aggregate price level in home country, P* in foreign country
d) eP/P*, where P is the aggregate price level in home country, P* in foreign country
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