Question: The inflation rate in the U.S. is 2%, while the inflation rate in Thailand is 5%. The current exchange rate for the Thai baht (THB)

The inflation rate in the U.S. is 2%, while the inflation rate in Thailand is 5%. The current exchange rate for the Thai baht (THB) is $0.0320. After supply and demand for the Thai baht has adjusted in the manner suggested by purchasing power parity, the new exchange rate for the Thai baht will be: $0.0329 $0.0323 $0.0311. $0.0314

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