What impact will a decrease in the Canadian price level have?
A)It will decrease real GDP demanded in Canada.
B)It will increase Canadian exports.
C)It will increase Canadian imports.
D)It will increase money demand in Canada.

Question

Quizplus · Accepted Answer

A decrease in the Canadian price level will increase the competitiveness of Canadian goods and services relative to other countries, making Canadian exports more attractive to foreign buyers. This will increase demand for Canadian exports, thus increasing Canadian exports. The other choices are not directly impacted by a decrease in the Canadian price level.

What Impact Will a Decrease in the Canadian Price Level