Relative Purchasing Power Parity is relevant because:
A: Empirical tests have shown that Absolute PPP is always violated, while Relative PPP is a good predictor of short-term exchange rate exposure.
B: Consumption bundles are not always comparable across countries.
C: Prices levels are not stationary over time.
D: Investors care about the real return on their international portfolio investments.
E: Investors care about the nominal return on their international portfolio investments.
A: Empirical tests have shown that Absolute PPP is always violated, while Relative PPP is a good predictor of short-term exchange rate exposure.
B: Consumption bundles are not always comparable across countries.
C: Prices levels are not stationary over time.
D: Investors care about the real return on their international portfolio investments.
E: Investors care about the nominal return on their international portfolio investments.
举一反三
- _______ states that differential rates of inflation between two countries tend to be offset over time by an equal but opposite change in the spot exchange rate. A: The Fisher Effect B: The International Fisher Effect C: Absolute Purchasing Power Parity D: Relative Purchasing Power Parity
- Which<br/>of these states that the difference in interest rates between two<br/>countries is equal to the percentage difference between the forward<br/>exchange rate and the spot exchange rate?() A: Arbitrage<br/>equilibrium B: Relative<br/>purchasing power parity C: Absolute<br/>purchasing power parity D: Interest<br/>rate parity E: Cross-rate<br/>parity
- What will the agencies help to increase A: Long range investments. B: Profitable investments, C: The number of investing countries. D: The number of countries receiving foreign investment.
- Which of the following statements about return objectives is TRUE A: To achieve the capital appreciation objective, the nominal rate of return must exceed the rate of inflation. B: The total return objective considers returns from both capital gains and current income, net of expected inflation. C: The current income objective is usually appropriate when an investor requires the purchasing power of the initial investment to increase over time.
- In the long run, ______. ( ) A: exchange rates are unlikely to obey relative PPP when all disturbances occur in the output markets. B: exchange rates obey absolute PPP when all disturbances occur in the output markets. C: exchange rates obey relative PPP when all disturbances occur in the output markets. D: exchange rates obey absolute PPP when all disturbances are monetary in nature.