Assume That Canada Initially Faces Payments Equilibrium in Its Merchandise

question 72

Multiple Choice

Assume that Canada initially faces payments equilibrium in its merchandise trade account as well as in its capital and financial account.Now suppose that Canadian interest rates increase to levels higher than those abroad.For Canada,this tends to promote:

• A) Net financial inflows
• B) Net financial outflows
• C) Net merchandise exports
• D) Net merchandise imports

---

Definitions:

Circumstances

The specific conditions or factors affecting a situation, event, or decision at a given time.

Christianity

A monotheistic religion based on the life and teachings of Jesus Christ, emphasizing love, redemption, and forgiveness.

National Religion

A religion that is considered by law or custom to be the established faith of a nation.

Being Single

A state of not being in a marriage or a romantic relationship, focusing on individual autonomy and self-reliance.