If Interest Rates in Canada Fall

question 155

Multiple Choice

If interest rates in Canada fall,

• A)the value of the Canadian dollar will fall as foreign investors decrease their holdings of Canadian investments.
• B)the value of the Canadian dollar will rise as foreign investors increase their holdings of Canadian investments.
• C)the value of the Canadian dollar will fall as foreign investors increase their holdings of Canadian investments.
• D)the value of the Canadian dollar will rise as foreign investors decrease their holdings of Canadian investments.
• E)the value of the Canadian dollar will fall as domestic investors purchase fewer foreign bonds.

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Definitions:

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