a. According to the Purchasing Power Parity (PPP) condition, what is the relationship between changes in price levels between two countries and changes in their nominal exchange rates?
b. There is a massive capital inflow into many Asian economies after the adoption of “Quantitative Easing” policy in the Unites States. Examine (with the aid of loan able funds market diagram) the possible impact of the influx of capital on the loan able fund market in these Asian economies.
c. Examine how property rights affect a nation’s standard of living.
d. In country A, between 2009 and 2013 GDP measured in current prices fell from $196 billion to $144 billion. Over the same period, the relevant price index fell from 100 to 90. What was the percentage decline in real GDP from 2009 to 2013? Show your work.