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9 and 10 thanks
QUESTION 9 In the long run, with relative PPP, if country A consistently has higher inflation than country B, then country A
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Answer #1

Ques-9)

Ans- Option B. Depreciating

As Country A's higher inflation will make its goods less attractive in foregein market which would decrease its Export. Decrease in Export will make Country A's currency to depreciate.

Ques-10)

False.

IF a country's currency is fundamentally overvalued, the central bank's foreign reserve will most likely to be decreased. As Investors will try to pull out from the overvalued currency which will decrease its foreign reserve.

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