Question the rate of inflation in india from 2007 to 2011, Ask an Expert

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Question: The rate of inflation in India from 2007 to 2011 was 8%. Over the same period, the inflation rate in the United States was 2.7%.

a. What is the implication of these inflation rates for the exchange rate between the dollar and the rupee? In particular, does the PPP condition imply a rise or a fall in the exchange rate? Explain your answer.

b. Is this an appreciation or a depreciation of the dollar? Is this an appreciation or a depreciation of the rupee?

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M92290383

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