purchasing power parity theory

The theory that the exchange rate between one currency and another is in equilibrium when their domestic purchasing powers at that rate of exchange are equivalent.

Accounting dictionary. 2014.

Look at other dictionaries:

  • Purchasing power parity — GDP per capita adjusted for Purchasing Power Parity (PPP) in the world, 2009 …   Wikipedia

  • purchasing power parity — PPP The theory that, after adjusting for the exchange rate, the cost of a good should be the same in all countries. In other words, the rate of exchange between two currencies should be such that each currency has exactly the same purchasing… …   Big dictionary of business and management

  • Purchasing power parity — The notion that the ratio between domestic and foreign price levels should equal the equilibrium exchange rate between domestic and foreign currencies. The New York Times Financial Glossary * * * purchasing power parity purchasing power parity ➔… …   Financial and business terms

  • purchasing power parity — The notion that the ratio between domestic and foreign price levels should equal the equilibrium exchange rate between domestic and foreign currencies. Bloomberg Financial Dictionary * * * purchasing power parity purchasing power parity ➔ parity… …   Financial and business terms

  • Purchasing Power Parity - PPP — An economic theory that estimates the amount of adjustment needed on the exchange rate between countries in order for the exchange to be equivalent to each currency s purchasing power. The relative version of PPP is calculated as: Where: S… …   Investment dictionary

  • purchasing power parity — Fin a theory that the exchange rate between two currencies is in equilibrium when the purchasing power of currency is the same in each country. If a basket of goods costs £100 in the United Kingdom and $150 for an equivalent in the United States …   The ultimate business dictionary

  • relative form of purchasing power parity — Theory that the rate of change in the prices of products should be somewhat similar, but not absolutely the same when measured in a common currency, as long as transportation costs and trade barriers are unchanged. Bloomberg Financial Dictionary …   Financial and business terms

  • absolute form of purchasing power parity — A theory that prices of products of two different countries should be equal when measured by a common currency. Also called the law of one price …   Financial and business terms

  • Chaos theory — This article is about chaos theory in Mathematics. For other uses of Chaos theory, see Chaos Theory (disambiguation). For other uses of Chaos, see Chaos (disambiguation). A plot of the Lorenz attractor for values r = 28, σ = 10, b = 8/3 …   Wikipedia

  • Покупательная способность — PURCHASING POWER Способность денежной единицы обмениваться на определенное количество товаров и услуг. Чем больше товаров и услуг можно купить, например, на Ј10, тем выше покупательная способность фунта стерлингов. Рост цен (инфляция) вызывает… …   Словарь-справочник по экономике

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