Question: Total: 50 marks Question B2 Consider the Purchasing Power Parity theory a) Explain the purchasing power parity hypothesis. (Word limit: 200) (20 marks) b) Referring

Total: 50 marks Question B2 Consider the Purchasing Power Parity theory

Total: 50 marks Question B2 Consider the Purchasing Power Parity theory a) Explain the purchasing power parity hypothesis. (Word limit: 200) (20 marks) b) Referring to the recent empirical and theoretical literature, discuss the problems in verifying this hypothesis. (Word limit: 800) (30 marks) Total: 50 marks

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