The United States produces computers and sells them to Canada. At the same time Canada produces cars and sells them to the United States. Suppose there is an appreciation in the dollar. This will cause: OA. A decrease in imports into the United States and a decrease in exports to Canada, which will cause a decrease in aggregate demand and real GDP. OB. An increase in imports into the United States and a decrease in exports to Canada, which will cause a decrease in aggregate demand and real GDP. OC. A decrease in imports into the United States and an increase in exports to Canada, which will cause an increase in aggregate demand and real GDP. O D. An increase in imports into the United States and an increase in exports to Canada, which will cause an increase in aggregate demand and real GDP.

The United States produces computers and sells them to Canada. At the same time Canada produces cars and sells them to the United States. Suppose there is an appreciation in the dollar. This will cause: OA. A decrease in imports into the United States and a decrease in exports to Canada, which will cause a decrease in aggregate demand and real GDP. OB. An increase in imports into the United States and a decrease in exports to Canada, which will cause a decrease in aggregate demand and real GDP. OC. A decrease in imports into the United States and an increase in exports to Canada, which will cause an increase in aggregate demand and real GDP. O D. An increase in imports into the United States and an increase in exports to Canada, which will cause an increase in aggregate demand and real GDP.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter29: Exchange Rates And International Capital Flows

Section: Chapter Questions

Problem 25CTQ: If a countrys currency is expected to appreciate in value, what would you think will be the impact...

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