Because Depreciation of the Real Exchange Rate of the Dollar

question 166

True/False

Because depreciation of the real exchange rate of the dollar increases Canadian net exports,the demand curve for dollars in the foreign-currency exchange market is downward sloping.

---

Definitions:

Trade Surplus

A situation where a country's exports exceed its imports, leading to a net inflow of domestic currency from foreign markets.

Trade Deficit

A situation where a country's imports exceed its exports during a specific time period.

Absolute Advantage

The capability of a body to generate a product or offer a service with greater efficiency than its rivals, utilizing an identical quantity of resources.

Exchange Rate

The rate at which one currency can be exchanged for another.