Question: For absolute purchasing power parity to hold: a . The International Fisher effect must exist. b . The unbiased forward rate theory must be observable.

For absolute purchasing power parity to hold:
a. The International Fisher effect must exist.
b. The unbiased forward rate theory must be observable.
c. Transaction costs must be zero.
d. The national inflation rates must be equal.
e. Interest rates must be the same across all markets.

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