If One USDollar Could Be Exchanged for One Canadian Dollar in 1970

question 111

Multiple Choice

If one U.S.dollar could be exchanged for one Canadian dollar in 1970, and one U.S.dollar can now be exchanged for 1.13 Canadian dollars, which of the following is true?

• A)The U.S.dollar lost value against the Canadian dollar.
• B)The Canadian dollar lost value against the U.S.dollar.
• C)The Canadian dollar gained value against the U.S.dollar.
• D)Inflation has been higher in the US than in Canada.
• E)Both A and C are true.

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Definitions:

Monetary Policy

Actions by a central bank or other regulatory authority to influence a nation's money supply and interest rates to achieve macroeconomic objectives such as controlling inflation, consumption, growth, and liquidity.

Fiscal Policy

Government policies related to taxation and public spending with the aim of influencing economic conditions, including growth, inflation, and unemployment rates.

Legislation

Laws and statutes that are enacted by a legislative body through its legislative process.

Marginal Propensity

The portion of additional income that an individual spends on consuming goods and services, as opposed to saving.