If Canadian Citizens Decide to Save a Larger Fraction of Their

question 193

Multiple Choice

If Canadian citizens decide to save a larger fraction of their incomes, which statement would best identify the effects?

• A) The real interest rate decreases, the real exchange rate of the dollar depreciates, and Canadian net capital outflow increases.
• B) The real interest rate decreases, the real exchange rate of the dollar appreciates, and Canadian net capital outflow decreases.
• C) The real interest rate increases, the real exchange rate of the dollar appreciates, and Canadian net capital outflow decreases.
• D) The real interest rate increases, the real exchange rate of the dollar depreciates, and Canadian net capital outflow increases.