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An Increase in the Value of the Canadian Dollar Relative

question 74

True/False

An increase in the value of the Canadian dollar relative to other currencies lessens the pressure on manufacturing companies based in Canada to consider locating facilities in low- cost labour countries such as China and India.


Definitions:

Marginal Cost

The cost of producing one additional unit of a product, which varies depending on the level of production.

Marginal Revenue

The gain in revenue from disposing of one additional unit of a good or service.

Price Elasticity

An indicator of the responsiveness of the quantity of a product demanded to its price change, represented in terms of percentage variation.

Demand Curve

An illustration depicting the correlation between a product's price and the level of demand from buyers, often characterized by a descending trajectory.

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