If Inflation in Mexico Is Lower Than It Is in Canada

question 164

Multiple Choice

If inflation in Mexico is lower than it is in Canada,

• A)the purchasing power of the peso in buying Mexican goods will fall relative to the Canadian dollar.
• B)the value of the Canadian dollar will rise in the long run.
• C)the value of the peso will rise in the long run.
• D)the purchasing power of the Canadian dollar in buying Canadian goods will rise relative to the peso.

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Definitions:

Medical Insurance Companies

Businesses that provide coverage for healthcare expenses to individuals or groups in exchange for premium payments.

Technological Change

The innovation and improvement in technology, processes, or methods, leading to increased efficiency, productivity, and new product development, affecting various sectors of an economy.

Productivity Growth

The increase in the efficiency of production in an economy, often measured by the output per unit of input over time.

Disposable Income

After-tax income. Term applies to individuals and to the nation.