If Canadian demand for French wine increases,the supply of Canadian dollars to the foreign-exchange market will ________ and the demand for euros will therefore ________.

Question

Quizplus · Accepted Answer

When Canadian demand for French wine increases, Canadians need more euros to pay for the wine, so they supply more Canadian dollars to the foreign-exchange market to obtain euros, increasing the demand for euros.

If Canadian Demand for French Wine Increases,the Supply of Canadian