The supply of foreign currency on the Canadian foreign exchange market comes from:
A) Canadian imports of goods and services from other countries.
B) Canadian imports of goods, services and securities from other countries.
C) foreign exports of goods, services and securities to Canadians.
D) Canadian exports of goods, services and securities to other countries.

Question

Quizplus · Accepted Answer

The supply of foreign currency in the Canadian foreign exchange market is primarily generated through Canadian exports of goods, services, and securities to other countries. When Canadian entities export, they are paid in foreign currency, which they then supply to the foreign exchange market in exchange for Canadian dollars.

The Supply of Foreign Currency on the Canadian Foreign Exchange