If a Country's Currency Depreciates in the Foreign Exchange Markets

question 8

Multiple Choice

If a country's currency depreciates in the foreign exchange markets, the result will be a shift of the aggregate demand curve __________; in addition, if intermediate goods are an important component of the country's imports, the short-run aggregate supply curve __________.

• A) to the left; also will shift to the left
• B) to the left; will shift to the right
• C) to the right; will shift to the left
• D) to the right; also will shift to the right

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Definitions:

Conditional Sale Contract

A type of contract in which the sale of an asset or property is contingent upon certain conditions being met, often used in real estate and high-value purchases.

Ordinary Annuity

A financial product where regular payments are received or paid at the end of each period, such as monthly or annually.

Compounded Monthly

Interest calculation method where interest is added to the principal each month, increasing the amount on which subsequent interest is calculated.

RRSP

A Registered Retirement Savings Plan that allows individuals in Canada to save for retirement on a tax-deferred basis.