Question

6. The United States is an important trading partner for Canada. How might the United States' military actions around the world affect the level of inventory that a Canadian company keeps on hand?

Answer 1

Trading Partner means frequent amount of trade is done between 2 nations. US is an important trading partner to Canada. Hence there is high amount of import and export being done between 2 nations of various commodities. Military actions of US might hamper the trade between 2 nations and may have an impact on Canada Economy.

Action on level of invenotry by Canada

Items exported to US: If certain goods are exported to US. Canada might want to lower such item inventory as in future US might not be able to make the payments due to excessive military activities. Canada might lower the levels of such invenotry if they see no alternative nation where they can export such items.

Items imported from US: For these items Canada might want to increase the levels of such inventory as in future US might not be in a position to produce such items and may impact Canada's import requirement. Canada might not increase the levels if it feels that an alternative nation can upkeep such demand and instead of import from US the items can be imported from such other nation.