Which of the Following Is Correct with Respect to Exchange

question 164

Multiple Choice

Which of the following is correct with respect to exchange rates?

• A) The value of one country's currency relative to another varies with changes in GDP, but not as a response to market conditions.
• B) The value of the Canadian dollar falls as the foreign demand for Canadian goods rises.
• C) Exchange rates typically fluctuate by very small amounts on a daily basis.
• D) Fluctuation in exchange rates have little impact on the balance of trade.
• E) All of these are correct.

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