ive What is the difference between Absolute Purchasing Power Parity (APPP) and Relat Purchasing Power Parity (RPPP)? a) (5 Marks) (France amdrd that only comprises 3 goods (Good 1, Good 2, Good 3) and 2 countries (France and Japan). Assume that consumption weights of these goods for both countries bo (0.50, 0.25,0.25) The price of the goods at time are listed below:- France (EUR) Japan(Yen) 20 40 80 60 Good 1 Good 2 Good 3 150 i) For each good, what exchange rate is consistent with the law of one price? (2 Marks) CONTINUED/... BE630-6-SP/3 i) Let the spot exchange rate at time t be equal to 0.50 EUR per Yen. Does absolute purchasing power parity (PPP) hold between the France and Japan? (3 Marks) c) You are now given the following time /+1 information: France(EUR) Japan(Yen) 40 100 190 50 90 70 Good 1 Good 2 Good 3 Using the information in (b), what spot exchange rate at time t+1 does relative purchasing power parity (PPP) imply? (5 Marks) ive What is the difference between Absolute Purchasing Power Parity (APPP) and Relat Purchasing Power Parity (RPPP)? a) (5 Marks) (France amdrd that only comprises 3 goods (Good 1, Good 2, Good 3) and 2 countries (France and Japan). Assume that consumption weights of these goods for both countries bo (0.50, 0.25,0.25) The price of the goods at time are listed below:- France (EUR) Japan(Yen) 20 40 80 60 Good 1 Good 2 Good 3 150 i) For each good, what exchange rate is consistent with the law of one price? (2 Marks) CONTINUED/... BE630-6-SP/3 i) Let the spot exchange rate at time t be equal to 0.50 EUR per Yen. Does absolute purchasing power parity (PPP) hold between the France and Japan? (3 Marks) c) You are now given the following time /+1 information: France(EUR) Japan(Yen) 40 100 190 50 90 70 Good 1 Good 2 Good 3 Using the information in (b), what spot exchange rate at time t+1 does relative purchasing power parity (PPP) imply