Year	Official exchange rate (LCU per US$, period average)	Inflation Kuwait, consumer prices (annual %)	Inflation USA, consumer prices (annual %)
1973 [YR1973]	0.296572316	8.266666666	6.220063864
1974 [YR1974]	0.293151416	12.99261084	11.03526022
1975 [YR1975]	0.290032332	8.392370572	9.131930735
1976 [YR1976]	0.292387416	5.235042735	5.737027083
1977 [YR1977]	0.286565999	9.889519259	6.486460064
1978 [YR1978]	0.275052749	8.689745123	7.647463851
1979 [YR1979]	0.276366082	7.049999999	11.26604409
1980 [YR1980]	0.270297416	6.928226686	13.50937033
1981 [YR1981]	0.278785332	7.374781596	10.31553398
1982 [YR1982]	0.287910999	7.776798427	6.160616062
1983 [YR1983]	0.291476666	4.718168093	3.212435233
1984 [YR1984]	0.296061916	1.17746005	4.317269076
1985 [YR1985]	0.30075325	1.490321814	3.561116458
1986 [YR1986]	0.290594667	0.95360674	1.858736059
1987 [YR1987]	0.27866325	0.654844692	3.740875912
1988 [YR1988]	0.27902925	1.46813288	4.009088244
1989 [YR1989]	0.293779417	3.342033591	4.82700303
1990 [YR1990]	0.288455	9.833635315	5.39795644
1991 [YR1991]	0.284268577	9.058188362	4.234963965
1992 [YR1992]	0.293222667	-0.545471214	3.028819678
1993 [YR1993]	0.3018386	0.382541365	2.951656966
1994 [YR1994]	0.296870315	2.534435262	2.607441592
1995 [YR1995]	0.298447721	2.686727566	2.805419689
1996 [YR1996]	0.299408563	3.553985697	2.9312042
1997 [YR1997]	0.303348835	0.682191435	2.337689937
1998 [YR1998]	0.30475564	0.129658288	1.552279099
1999 [YR1999]	0.304414667	2.990810359	2.188027197
2000 [YR2000]	0.306751583	1.812946139	3.376857271
2001 [YR2001]	0.306681667	1.3	2.826171119
2002 [YR2002]	0.303914252	0.888450148	1.586031627
2003 [YR2003]	0.298011521	0.961350294	2.270094973
2004 [YR2004]	0.2947	1.248564437	2.677236693
2005 [YR2005]	0.292	4.142975836	3.392746845
2006 [YR2006]	0.290176225	3.057013392	3.225944101
2007 [YR2007]	0.284213958	5.484949833	2.852672482
2008 [YR2008]	0.268828367	10.58270979	3.839100297
2009 [YR2009]	0.287785417	4.609595484	-0.355546266
2010 [YR2010]	0.286606592	4.496402878	1.640043442
2011 [YR2011]	0.275978944	4.905335628	3.156841569
2012 [YR2012]	0.279935558	3.199343724	2.069337265
2013 [YR2013]	0.283589442	2.702702703	1.464832656
2014 [YR2014]	0.284557198	2.908900929	1.622222977

Plot past annual exchange rate changes against the differential inflation rates between Kuwait and the U.S. for the last 20 years. 2. Regress the annual rate of exchange rate changes on the annual inflation rate differential to estimate the intercept and the slope coefficient, and interpret the regression results. 3. Does the purchasing power parity hold for the Kuwaiti Dinar-U.S. dollar exchange rate? Explain your answer.