What Is the Main Argument of the Proponents of a Fixed

question 55

Multiple Choice

What is the main argument of the proponents of a fixed exchange rate system for Canada?

• A)There is less risk for importers,exporters and investors,and as a result there would be more trade,and the resulting gains from trade.
• B)The fixed exchange rate would act as a shock absorber and reduce the swings in output and employment.
• C)Canada's exports would be more attractive to the rest of the world,which would lead to a larger current account surplus.
• D)Investment in Canada would be more attractive to the rest of the world,which would lead to a larger capital account surplus.
• E)Canada is traditionally an exporting nation,and a fixed exchange rate is more advantageous for exporters.

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