Suppose an increase in the demand for dollars has caused an appreciation of the dollar. According to the purchasing power parity

Question

lora16 [44]

3 years ago

13

Suppose an increase in the demand for dollars has caused an appreciation of the dollar. According to the purchasing power parity

theorem, the value of the dollar in the future will:

Business

1 answer:

Leviafan [203] · Answer 1 · 2022-03-15T05:52:21+03:00

Answer:

Appreciate more

Explanation:

Suppose an increase in the demand for dollars has caused an appreciation of the dollar. According to the purchasing power parity theorem, the value of the dollar in the future will appreciate more. This is because the shift in demand and supply will cause an increase in the value of the dollar. Purchasing power parity (PPP) is a theory which states that exchange rates between currencies are in equilibrium when their purchasing power is the same in each of the two countries.