In determining the exchange rate between the Canadian dollar and British pound, if Canadian income increases, then
A) the demand for pounds will increase, leading to depreciation of the Canadian dollar, assuming exchange rates are allowed to float
B) the demand for pounds will increase, leading to depreciation of the Canadian dollar, assuming exchange rates are fixed
C) the demand for pounds will increase, leading to appreciation of the Canadian dollar, assuming exchange rates are allowed to float
D) the demand for pounds will increase, leading to appreciation of the Canadian dollar, assuming exchange rates are fixed
E) the supply of pounds will shift to the left, causing appreciation of the Canadian dollar, assuming exchange rates are fixed
Correct Answer:
Verified
Q117: Exhibit 20-4 Q118: Which of the following is not a Q119: An increase in U.S.income that increases American Q120: Exhibit 20-4 Q121: Suppose that U.S.incomes rise relative to British Q123: Which of the following is true? Q124: In determining the exchange rate between the Q125: An increase in the U.S.demand for foreign Q126: Imagine that there are only two nations Q127: Which of the following best describes a
A)If the
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