Suppose That a U

question 119

Multiple Choice

Suppose that a U.S. dollar can earn interest of 5 percent a year in Chicago and a Canadian dollar can earn interest of 7 percent a year in Winnipeg. Will money flow from Chicago to Winnipeg?

• A)Yes, because the returns on money are higher in Winnipeg.
• B)No, because the outflow of U.S. funds would create a decrease in the U.S. dollar value, penalizing investors when they attempted to recover their funds.
• C)No, if investors expect that the Canadian dollar will appreciate by at least 2 percent per year.
• D)No, if investors expect the U.S. dollar to appreciate by at least 2 percent per year.
• E)No, as long as the U.S. dollar maintains higher purchasing power than the Canadian dollar.

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Definitions:

Behavior Modification

A therapeutic approach designed to change undesirable behaviors through reinforcement strategies.

Overweight

Having a body weight more than what is considered normal or healthy for a certain height, often measured by body mass index (BMI).

Exercise

Exercise is physical activity that is planned, structured, and repetitive for the purpose of conditioning the body, improving health, and maintaining fitness.

Cultural Issues

Problems or challenges that arise within a cultural context, often relating to differences in beliefs, values, and practices.