1. Based on the given price levels and exchange rates in Canada, France, and between CAD and EUR, the internal PPP exchange rate is CAD 1.35/EUR, the external PPP rate is CAD 1.40/EUR, and France appears to be overvalued by 1.5% according to the implied exchange rate calculation. 2. For the job offer scenario, the salary offered in London has a higher purchasing power when adjusted for PPP rates, so the London job at 100,000 euro per year is the better choice over the New York job paying $150,000. The London salary can buy 1.40/1.65 = 84.8% more when converted to dollars at