The difference between relative and absolute purchasing power parity (P) is that ( ).
Arelative PPP includes a measure of the aggregate price level in each country, while absolute PPP does not.
Bempirical studies show that relative PPP holds in both the short and long run, while absolute PPP holds only in the short run.
Crelative PPP relates interest rate differentials, while absolute PPP relates goods prices.
Drelative PPP implies that exchange rate movements will offset changes in relative prices over time, while absolute PPP implies that exchange-rate adjusted prices will always be equal.