Purchasing power parity based problem
Problem: (Purchasing Power Parity):A television set costs $500 in the United States. The same set costs 550 euros in France. If purchasing power parity holds, what is the spot exchange rate between the euro and the dollar?
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A television set costs $500 in the United States. The same set costs 550 euros in France.
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What is the price of the watches, in U.S. dollars, if purchased at today's spot rate?
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