Question: Is overshooting (in theory and in practice ) consistent with PPP? Consider the reasons for the usefulness of PPP in the short run versus the

Is overshooting (in theory and in practice ) consistent with PPP?

Is overshooting (in theory and in practice ) consistent with PPP? Consider the reasons for the usefulness of PPP in the short run versus the long run and the assumption we've used in the asset approach in the short run versus the long run. How does overshooting help to resolve the empirical behavior of exchange rates in the short run versus the long run

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