Purchasing Power Parity theory (PPP) is a basis for economical comparability. However, can this really be true for just about any product at any time? Is purchasing electric power parity (PPP) only valid in the long run, or could it be also appropriate in the short run, and what about the type of the merchandise, i. e. tradable and non-tradable goods? Which limits are there to PPP?
Purchasing electric power parity attempts to explain why the real exchange rate between currencies..
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