What Are the Effects of a Decrease in Canadian Interest

question 105

Multiple Choice

What are the effects of a decrease in Canadian interest rates?

• A) a depreciation of the dollar and greater net exports
• B) a depreciation of the dollar and smaller net exports
• C) an appreciation of the dollar and greater net exports
• D) an appreciation of the dollar and smaller net exports

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Definitions:

Total Variable Costs

The sum of all costs that vary with the level of production, such as materials and labor, as opposed to fixed costs which remain constant regardless of production level.

Firm Produces

The process by which a firm transforms inputs into outputs, engaging in the production of goods or services for sale.

Market Demand

The total quantity of a good or service that all consumers in a market are willing and able to purchase at various prices.

Equilibrium Price

The cost at which the amount of products available for sale matches the amount of products consumers want to buy.