Given Floating Exchange Rates, If Japan Increases Its Demand for Canadian

question 118

Multiple Choice

Given floating exchange rates, if Japan increases its demand for Canadian goods at the same time that Canada increases its demand for Japanese goods, then we would expect the yen's exchange value to

• A) appreciate against the dollar.
• B) depreciate against the dollar.
• C) remain constant against the dollar.
• D) appreciate, depreciate, or remain constant against the dollar.

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Definitions:

Comparison Lines

In the context of perception, these are reference lines against which other objects or magnitudes are compared or judged.

Conformity

The tendency of individuals to align their attitudes, beliefs, and behaviors with those of a group or society.

Informational Social Influence

The influence of others that leads to conformity because of a desire to be correct and understand the correct behavior or opinion.

Normative Social Influence

Involves the impact of social norms and the desire to be accepted by others on an individual's behavior.