Assuming a fixed exchange-rate system,which of the following would contribute to a Canadian balance of payments deficit?

Question

Quizplus · Accepted Answer

An increase in tariffs on Canadian softwood lumber by the United States would lead to a decrease in exports and thus, contribute to a balance of payments deficit.

Answer: A and D 
 Large purchases of goods or services by foreigners, such as tickets for a concert or a mansion, would increase imports and contribute to a balance of payments deficit.

Assuming a Fixed Exchange-Rate System,which of the Following Would Contribute