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Question: suppose the dollarfranc exchange rate equals s050 parity ppp theory...

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Suppose the dollar/franc exchange rate equals S0.50 parity (PPP) theory, what will happen to the dollars exchange value under each of the following per frane. According to the puachasing power circumstances? 1. (5 points) The U.S. price level increases by 10 percent, and the peice level in Switzerland increase by 5 percent. 2. (5 points) The U.S. price level increases by 10 percent, and the price level in Switzerland decreases by 5 percent 3. (5 points) The U.S. price level decreases by 10 percent, and the price level in decreases by 5 percent. 4. (S points) The U.S. price level decreases by 10 percent, and the price level in Switaerland increases by 5 percent 第4页
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