Practicing Success
There are two statements marked as Assertion (A) and Reason (R). Mark your answer as per the options given below. Assertion: The purchasing Power (PPP) theory is used to make long-run predictions about exchange rates in all types exchange rate system. |
Both Assertion (A) and reasoning (R) are correct and R is the correct explanation of A. Both Assertion (A) and reasoning (R) are correct but R is not the correct explanation of A. Assertion (A) is true but Reasoning (R) is not correct. Assertion (A) is not true but Reasoning (R) is correct. |
Assertion (A) is not true but Reasoning (R) is correct. |
The correct answer is option 4: Assertion (A) is not true but Reasoning (R) is correct. Assertion: The purchasing Power (PPP) theory is used to make long-run predictions about exchange rates in all types exchange rate system. This is incorrect. The purchasing Power (PPP) theory is used to make long-run predictions about exchange rates in a flexible exchange rate system. |