What Effect Does a Depreciation of the Dollar Have on Real

question 206

Multiple Choice

What effect does a depreciation of the dollar have on real GDP in Canada in the short run?

• A)Real GDP will fall.
• B)Real GDP will rise.
• C)Real GDP will be unaffected by the depreciation of the dollar.
• D)Real GDP will be unchanged, but nominal GDP will rise.
• E)Real GDP will fall, but nominal GDP will rise.

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Definitions:

Cash Balance Plan

A type of defined benefit retirement plan where employee benefits are expressed as a hypothetical account balance, making it resemble a defined contribution plan.

PBGC

Pension Benefit Guaranty Corporation, a U.S. federal agency responsible for protecting retirement incomes by insuring private-sector defined benefit pension plans.

ERISA

The Employee Retirement Income Security Act of 1974, a federal law that sets minimum standards for most voluntarily established pension and health plans in private industry.

Healthcare Benefits

Insurance or services provided by employers or governments to cover medical expenses and health-related issues for individuals.