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A Rs 400 shirt in India costs $8 in the US. Indian prices rise 20% and US prices 50%. New PPP rate?
ARs 50 per dollar
BRs 60 per dollar
CRs 40 per dollar
DRs 30 per dollar
Answer & Solution
Correct answer: C. Rs 40 per dollar
Indian shirt becomes Rs 480 and US shirt $12, so one dollar equals 480/12 = Rs 40.
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