Figure 151 Alt Text for Figure 15

question 35

Multiple Choice

Figure 15.1 Alt text for Figure 15.1: In figure 15.1, a graph illustrates the quantity of euros traded against the exchange rate.
Long description for Figure 15.1: The x-axis is labelled, quantity of euros traded per day.The y-axis is labelled, exchange rate, Canadian dollar against euro, with values 1.00 and 1.05 marked.An upward sloping supply curve intersects the downward sloping demand curves D1 and D2.The intersection point of S and D1, A, corresponds to the point Canadian dollar 1.05 of the y-axis, and is displayed by a dotted line.The intersection point of S and D2, B, corresponds to the point 1.00 of the y-axis, also displayed by a dotted line.A down arrow is shown between the 2 dotted lines.A bold left arrow points from D1 to D2.Two dotted vertical lines from the intersection points also meet the x-axis.
-Refer to Figure 15.1.Which of the following would cause the change depicted in the figure above?

• A)Canadian productivity rises relative to European productivity.
• B)Europeans decrease their preferences for Canadian goods relative to European goods.
• C)The European Union increases its quotas on French wine.
• D)an increase in the price level of Canadian goods relative to European goods
• E)the signing of a free trade agreement between the eurozone and Canada

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Definitions:

Price of X

The specific cost associated with acquiring good or service X, subject to market conditions and demand.

Price of Y

Refers to the cost associated with acquiring or purchasing a specific good or service, denoted as "Y."

Budget Constraint

A financial limitation that defines the combination of goods and services an individual can afford to purchase given their income and the prices of those goods and services.

Income

The financial gain acquired by an individual or a company, which is typically calculated on an annual basis and obtained through work, investments, or business operations.