Refer to the diagram below where D and S are Canada's demand for and supply of pesos.At the equilibrium exchange rate,E,Canada's balance of payments is in equilibrium.Under a system of flexible exchange rates,the shift in demand from D1 to D2 will: 
Definitions:
Wages And Salaries
Compensation paid to employees for their services, where wages are often hourly rates and salaries are fixed annual amounts.
Planning Budget
A financial plan for the future which outlines projected income and expenditures during a specific period.
Net Operating Income
The profit generated from a company's regular business operations, excluding deductions for interest and taxes.
Flexible Budget
A flexible budget that varies according to activity or volume changes.
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