Calculating the gross domestic product for various countries using purchasing power parity exchange rate is more reliable as exchange rates fluctuations are included. less reliable as exchange rates fluctuations are included. more reliable as the impact of exchange rates fluctuations is reduced.

Calculating the gross domestic product for various countries using purchasing power parity exchange rate is more reliable as exchange rates fluctuations are included. less reliable as exchange rates fluctuations are included. more reliable as the impact of exchange rates fluctuations is reduced.

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter28: International Trade And Finance

Section: Chapter Questions

Problem 11SQ

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Question

100%

Calculating the gross domestic product for various countries using purchasing power parity exchange rate is

more reliable as exchange rates fluctuations are included.
less reliable as exchange rates fluctuations are included.
more reliable as the impact of exchange rates fluctuations is reduced.

Definition Definition Value of one unit of currency in terms of goods and services. Purchasing power refers to the ability of money to purchase goods and services at a particular point of time. As price levels in the economy increase, the purchasing power of one unit of currency decreases and vice versa.

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