If a Canadian household buys a $75 handbag in Italy, Canadian consumption increases by $75. What happens to Canadian imports/exports and GDP?
A) Canadian imports increase by $75, and Canadian GDP increases by $75.
B) Canadian imports increase by $75, but Canadian GDP is unaffected.
C) Canadian imports are unaffected, and Canadian GDP is unaffected.
D) Canadian exports increase by $75, and Canadian GDP increases by $75.
Correct Answer:
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