--%>
Assignment Help - homework help

Purchasing power parity of US and Canadian dollar

Under what condition would the U.S. dollar and the Canadian dollar said to be have achieved purchasing power parity?
The U.S. dollar and the Canadian dollar would be assumed to have achieved purchasing power parity while the exchange rate reflects the relative prices of market basket of traded goods and services at the present exchange rate. There would be no incentive to change U.S. dollars to Canadian dollars or to convert Canadian dollars to U.S. dollars and purchase goods or services in the other country.

   Related Questions in Finance Basics

  • Q : Define Cash Basis of Accounting Cash

    Cash Basis of Accounting: The base of accounting in which expenditures and revenues are recorded whenever cash is received or distributed.

    		•
  • Q : Define the term Surplus Define the term

    Define the term Surplus: It is an outdated term for a fund’s excess of assets (or resources) over liabilities.

    		•
  • Q : Define Budget Year Budget Year (BY) :

    Budget Year (BY): The next state fiscal year, starting July 1 and ending June 30, for which the Governor's Budget is proposed (that is, the year following the present fiscal year).

    		•
  • Q : Describe matching principle of working

    Describe matching principle of working capital financing? Explain the benefits of following this principle? The matching principle is while short-term financing is utilized for temporary current assets while long-term financing is utilized for

    		•
  • Q : Reimbursement Warrant or Revenue

    Reimbursement Warrant (or Revenue Anticipation Warrant): A warrant which has been sold by the State Controller’s Office, as an outcome of a cash shortage in th

    		•
  • Q : Describe relationship among a bonds

    Describe relationship among a bond's market price and its promised yield to maturity? Describe.A bond's market price based on its yield to maturity (YTM). While a bond has YTM greater than its coupon rate, it sells at discount from its face va

    		•
  • Q : Define Planning Estimate Line Planning

    Planning Estimate Line: The separate planning estimate adjustment or entry for a specific expenditure or type.

    		•
  • Q : Explain Language Sheets Language Sheets

    Language Sheets: The copies of the current Budget Act appropriation items offered to Finance and departmental staff each fall to update for the proposed Governor’s Budget. Such updated language sheets become the proposed Budget Bill. In spring,

    		•
  • Q : Price Earning ratio Define the term

    Define the term Price Earning ratio and how it is calculated?

    		•
  • Q : Describe value investing Value

    Value investing is an investment strategy which involves buying securities whose shares appear underpriced by some form(s) of fundamental analysis, like stocks with low Price to Earning or Price to Book value. This strategy basically is of buying stoc

    		•