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saint MBA570 module 2 dsicsusion




Question;Module 2 Discussion;The Law of One Price states that equivalent;investment opportunities trading in different competitive markets will;have the same price. Yet, one can find examples where that rule seems to;be violated. It is a well-known fact that Americans pay a much higher;price for most prescription drugs than people in most other countries.;Also, the price (when adjusted for exchange rates) for the same make and;model of automobile varies greatly across different countries.;Furthermore, the price of a barrel of crude oil varies between;locations. For example, on October 12, 2012, the price for Brent crude;oil produced in Europe was $114.21 and the price for West Texas;Intermediate (WTI) crude oil produced in Texas was $91.86.;Do these three cases demonstrate that the Law of One Price is false? Why or why not?


Paper#48462 | Written in 18-Jul-2015

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