Economic ?
In a two-country, one-good model, Trinidad and Jamaica both produce only rum. The domestic price of one bottle of rum in Jamaica is 10 Jamaican dollars. The domestic price of one bottle of rum in Trinidad is 15 Trinidadian dollars. What will the exchange rate between the two countries be, according to PPP?
标签: Economic
PPP exchange rate would be 1JD=1.5TD or 1TD=2/3=0.67JD