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The most widely accepted theory of foreign exchange rate determination is purchasing power parity, yet it has proven to quit

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The most widely accepted theory of foreign exchange rate determination is purchasing power parity, yet it has proven to quit poor at forecasting future spot exchange rates. Why?
Exchange Rate
The value of one currency for the purpose of conversion to another. Exchange Rate means on any day, for purposes of determining the Dollar Equivalent of any currency other than Dollars, the rate at which such currency may be exchanged into Dollars...

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Although PPP seems to possess a core element of common sense it ha…View the full answer


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Multinational Business Finance

Multinational Business Finance

ISBN: 978-0133879872

14th edition

Authors: David K. Eiteman, Arthur I. Stonehill, Michael H. Moffett

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Question Posted: January 19, 2017 09:54:48
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