The change in the exchange rate of a country’s currency over a certain period is mainly determined by the difference in the inflation rate between the country and the foreign country during this period. This is the view of which following theories().


The change in the exchange rate of a country’s currency over a certain period is mainly determined by the difference in the inflation rate between the country and the foreign country during this period. This is the view of which following theories().

A.theory of relative purchasing power parity

B.theory of absolute purchasing power parity

C.psychological theory of exchange

D.the theory of interest rate parity

正确答案:theory of relative purchasing power parity