Under the law of one price, the price of an internationally traded commodity in one nation in a two nation world is equal to the exchange rate times the price of the same commodity in the other nation Assuming that such a law holds, explain why, if the first nation would otherwise face no inflation...

According to the monetary approach inflation in the second ...

Under the law of one price, the price of an internationally traded commodity in one nation in

Question:

Under the law of one price, the price of an internationally traded commodity in one nation in a two-nation world is equal to the times the price of the same commodity in the other nation. Assuming that such a law holds, explain why, if the first nation would otherwise face no inflation at home, it will not be able to maintain in the long run both constant prices and a constant in the face of inflation in the other nation.
Exchange Rate
The value of one currency for the purpose of conversion to another. Exchange Rate means on any day, for purposes of determining the Dollar Equivalent of any currency other than Dollars, the rate at which such currency may be exchanged into Dollars...