What Is the Effect of an Increase in the Canadian

question 10

Multiple Choice

What is the effect of an increase in the Canadian real interest rate above the world interest rate?

• A) Canadians buy more foreign assets, which increases Canadian net capital outflow.
• B) Canadians buy more foreign assets, which reduces Canadian net capital outflow.
• C) Foreigners buy more Canadian assets, which reduces Canadian net capital outflow.
• D) Foreigners buy more Canadian assets, which increases Canadian net capital outflow.

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Definitions:

Peripheral Vascular Resistance

The resistance that blood vessels outside of the heart and brain offer to blood flow, playing a key role in regulating blood pressure.

Butterfly-Shaped

Describes a pattern or rash that typically appears on the face and is reminiscent of the wings of a butterfly; often associated with lupus erythematosus.

Pigmentation

The coloring of a person's skin, hair, mucous membranes, and retina of the eyes, which is determined by the amount and type of melanin produced by the body.

Chloasma

Dark, discolored patches on the skin, often occurring in pregnant women; also known as melasma or the "mask of pregnancy."