Which of the following is NOT a limitation of the purchasing power parity theory when predicting exchange rate movements?

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Inflation influences currency exchange ratesCross-border capital movements impact exchange ratesGovernments occasionally enforce trade barriers like tariffs and quotasCertain goods cannot be traded internationally

Explanation

The purchasing power parity theory faces challenges in forecasting exchange rates due to factors such as international capital flows, trade restrictions imposed by governments, and the fact that some goods are not traded globally. However, inflation affecting exchange rates is accounted for within the theory and is not considered a limitation.