Why is it better to use a PPP exchange rate to compare incomes across countries than an

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Why is it better to use a PPP exchange rate to compare incomes across countries than an actual exchange rate?


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...
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International Financial Management

ISBN: 978-0132162760

2nd edition

Authors: Geert Bekaert, Robert J. Hodrick

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