Question $4$

$1$ pts

According to the purchasing power parity theory increase in domestic price level will bring about $....$ Select one $-$ the most appropriate answer to fill in the space above.

Depreciation of foreign currency.

All answers are correct.

Appreciation of foreign currency and respective jump in foreign economy price level.

Depreciation of domestic currency.

No correct answer.

Appreciation of domestic currency and drop in foreign economy price level.