Figure a Below Depicts the Demand and Supply of Japanese

Figure A below depicts the demand and supply of Japanese yen in the foreign currency exchange market. Figure B below depicts the aggregate supply-aggregate demand model for the Japanese economy. Use these figures to answer the next two questions:


-The figure below depicts the three possible aggregate demand curves.

If the Bank of Canada (the Canadian central bank) ____________,the Canadian dollar will depreciate and the aggregate demand curve will shift from AD₂ to ____________.

A) devalues the Canadian dollar; AD₁
B) prints more Canadian dollars; AD₁
C) decreases the supply of Canadian dollars; AD₃
D) increases the supply of Canadian dollars; AD₃
E) prints less Canadian dollars; AD₃