How Will the Exchange Rate (Foreign Currency Per Dollar)respond to a Decrease

question 104

Multiple Choice

How will the exchange rate (foreign currency per dollar) respond to a decrease in the relative rate of productivity growth in Canada in the long run?

• A)Exchange rates will rise.
• B)Exchange rates will fall.
• C)Exchange rates will be unaffected by changes in the relative rate of productivity growth in Canada, both in the short run and in the long run.
• D)The exchange rate will be affected in the short run, but not in the long run.

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Definitions:

Brightness

The perception of visual light intensity; the quality of being lighted, often quantified in terms of luminescence.

Saturation

The point at which a substance can no longer absorb or dissolve another substance, or in qualitative research, the point at which no new information is found.

Hue

The attribute of colors that enables an observer to classify them as red, green, blue, and so on, often determined by the wavelength of light.

Wavelength

The distance between successive crests of a wave, especially points in a sound wave or electromagnetic wave.