Suppose Americans suddenly develop a strong taste for Canadian whiskey. What happens to the demand for Canadian dollars in the foreign exchange market? What happens to the value of Canadian dollars in the foreign exchange market? What about U.S. dollars? What happens to the quantity of net exports in Canada, other than whiskey, as a result of your answer in part b? What about the U.S.?
Suppose Americans suddenly develop a strong taste for Canadian whiskey. What happens to the demand for Canadian dollars in the foreign exchange market? What happens to the value of Canadian dollars in the foreign exchange market? What about U.S. dollars? What happens to the quantity of net exports in Canada, other than whiskey, as a result of your answer in part b? What about the U.S.?
Chapter4: The Aggregate Economy
Section: Chapter Questions
Problem 5E
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Suppose Americans suddenly develop a strong taste for Canadian whiskey.
- What happens to the
demand for Canadian dollars in the foreign exchange market? - What happens to the value of Canadian dollars in the foreign exchange market? What about U.S. dollars?
- What happens to the quantity of net exports in Canada, other than whiskey, as a result of your answer in part b? What about the U.S.?
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