How Would a Decrease in the Canadian Budget Deficit Affect

question 196

Multiple Choice

How would a decrease in the Canadian budget deficit affect the exchange rate in the market for dollars?

• A)The exchange rate will increase.
• B)The exchange rate will decrease.
• C)The quantity of dollars traded for foreign currencies will rise.
• D)The exchange rate will not be affected by a change in the budget deficit.
• E)The impact of the decrease in the budget deficit on the exchange rate cannot be predicted.

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Definitions:

Return On Investment

A financial metric used to evaluate the efficiency of an investment or compare the efficiency of several investments, calculating the return relative to the investment's cost.

Income From Operations

Revenue generated from a company's regular business activities, excluding revenue from non-operating sources.

Invested Assets

Assets that have been allocated or invested in various forms such as stocks, bonds, or real estate, aiming for a financial return.

Profit Margin Factor

A measure of a company's earnings (or profits) relative to its revenue, showing the percentage of each dollar of sales that results in profit.