In the Open-Economy Macroeconomic Model, If Investment Demand Increases, Then

question 332

Multiple Choice

In the open-economy macroeconomic model, if investment demand increases, then

• A)the supply of dollars in the market for foreign-currency exchange shifts left.
• B)the supply of dollars in the market for foreign-currency exchange shifts right.
• C)the demand for dollars in the market for foreign-currency exchange shifts left.
• D)the demand for dollars in the market for foreign-currency exchange shifts right.

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Definitions:

Investment

The process of distributing assets, typically funds, in anticipation of earning revenue or gains.

Compounded Monthly

Pertains to the method of adding interest each month to both the initial principal and the previously accrued interest.

Annual Deposit

A fixed amount of money deposited into an account once every year.

RRSP

A Registered Retirement Savings Plan in Canada that allows for tax-deferred savings for retirement.