Canada Is a Small Open Economy with a Flexible Exchange

question 184

Multiple Choice

Canada is a small open economy with a flexible exchange rate.Which of the following effects will a contractionary fiscal policy have?

• A)It will cause the Canadian interest rate to fall below the world interest rate for a short period of time, which in turn will cause the dollar to depreciate and net exports to increase.
• B)It will cause the Canadian interest rate to rise above the world interest rate for a short period of time, which in turn will cause the dollar to appreciate and net exports to decrease.
• C)It will cause the Canadian interest rate to fall below the world interest rate for a short period of time, which in turn will cause the dollar to appreciate and net exports to decrease.
• D)It will cause the Canadian interest rate to rise above the world interest rate for a short period of time, which in turn will cause the dollar to depreciate and net exports to increase.

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Definitions:

Observable Culture

The elements of culture such as rituals, symbols, and behaviors that can be seen and experienced in an organization.

Core Values

Fundamental beliefs or principles that guide the behavior and decision-making within an organization.

Pre-Observable Culture

Refers to the underlying beliefs, assumptions, and values that exist within an organization but are not immediately visible or easily detectable.

Workplace Spirituality

A framework within organizations that promotes employees' sense of purpose through work, respects their inner lives, and integrates their core values and beliefs into the workplace.