If the Canadian Real Interest Rate Exceeds the World Real

question 71

Multiple Choice

If the Canadian real interest rate exceeds the world real interest rate, what would Canadian savers most likely do?

• A) Canadian savers would prefer to buy foreign assets.
• B) Canadian savers would prefer to wait until the real interest rate falls to equal the world interest rate.
• C) Canadian savers would sell their Canadian assets and buy foreign assets instead.
• D) Canadian savers would sell their foreign assets and buy Canadian assets instead.

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