Canada and the U.S. are major trading partners. If Canada experiences a major increase in economic growth, it could place ____ pressure on Canadian interest rates and ____ pressure on U.S. interest rates.

Question

Quizplus · Accepted Answer

A major increase in economic growth in Canada could lead to higher demand for money, thus placing upward pressure on Canadian interest rates. This growth could also increase demand for U.S. goods, potentially leading to higher U.S. economic activity and upward pressure on U.S. interest rates.