Q11. Harold Jennings, CFA, an economist the World Bank, is considering the use of purchasing power parity (PPP) as a useful tool in forecasting exchange rates for certain South American countries. The appropriate method he should use is: A) relative PPP because it tends to hold over the short run. B) relative PPP because it tends to hold over the long run. C) absolute PPP because it tends to hold over the long run.
Q12. Carole Holden, CFA, is an economist for the International Monetary Fund. As a believer of purchasing power parity (PPP), she wants to create a suitable basket of goods for use in all countries as a means of determining exchange rates. Although she is very idealistic in her endeavor, one major shortcoming in her approach is that absolute PPP assumes: A) real interest rates are constant throughout the world. B) there are no restraints to trade. C) inflation rates are constant throughout the world.
| 
发表于 2009-1-13 14:37
| 
