If foreign holdings of Canadian dollars increase, holding all else constant,
A)the balance on the Canadian financial account will increase.
B)the balance on the Canadian current account will increase.
C)the balance on the Canadian capital account will increase.
D)the Canadian balance of trade will increase.
E)the value of the Canadian dollar will decrease.

Question

Quizplus · Accepted Answer

Foreign holdings of Canadian dollars are a part of the financial account of the Canadian balance of payments. An increase in foreign holdings of Canadian dollars will increase the balance on the Canadian financial account.

If Foreign Holdings of Canadian Dollars Increase, Holding All Else