Homework Answers
Answer-: (A) Falls; Depreciates
Due to falls in intrest rate the value of canadian dollar weak against its U.S Counterpart .
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How do the Bank of Canada's actions change the exchange rate? When the Bank of Canada...
Suppose the Bank of Canada raises the overnight loans rate. Describe the ripple effects of this...
Suppose the Bank of Canada raises the overnight loans rate. Describe the ripple effects of this monetary policy. Other short-term interest rates and the exchange rate Consumption expenditure, investment, and net exports The quantity of money and supply of loanable funds Aggregate demand Real GDP growth and the inflation rate O A. rise; increase OB. fall; decrease O c. fall; increase OD. rise; decrease O A. decreases; decrease OB. increases; decrease or remain the same O c. decreases; increase or...
7. Suppose that Canada imposes an import quota on automobiles. In the open-economy macroeconomic model, which of...
7. Suppose that Canada imposes an import quota on automobiles. In the open-economy macroeconomic model, which of the following curves would this quota shift? a. supply of loanable funds left b. demand for loanable funds left c. demand for Canadian dollars right d. supply of Canadian dollars left 8. Suppose the Canadian government imposed import quotas on agricultural products. According to the foreign-currency exchange market diagram, which of the following outcomes would most likely result? a. Both the demand and supply curves...
Suppose that you go on vacation to Canada every summer. Last year, the hotel room where you stayed cost C$100 per night, and it costs the same this year. The exchange rate was 1.04 USS/C$ last year,...
Suppose that you go on vacation to Canada every summer. Last year, the hotel room where you stayed cost C$100 per night, and it costs the same this year. The exchange rate was 1.04 USS/C$ last year, and it is 0.95 US$/C$ this year. This means you will pay than you paid last year. per night this year The U.S. dollar-Canadian dollar exchange rate is essentially the price of a Canadian dollar in terms of U.S. dollars. When this price...
want to know the answer for both the questions....thanksss ASAP 1. In The News: Bank of...
want to know the answer for both the
questions....thanksss ASAP
1. In The News: Bank of Canada increases overnight rate Canada increases overnight rate target to 14 per cent October 24, 2018- The Bank of Canada today increased its target for the to 1 34 per cent. The Bank Rate is correspondingly 2 per cent and y increased its target for the overnight rate 12 per cent is correspondingly 2 per cent and the deposit rate is 1 Questions: a)...
Describe the channels by which monetary policy ripples through the economy and explain how each channel...
Describe the channels by which monetary policy ripples through the economy and explain how each channel operates. Suppose the Bank of Canada raises the overnight loans rate. When the Bank of Canada raises the overnight loans rate, it makes an open market Other short-term interest rates and the exchange rate rise. The quantity of money and the supply of loanable funds decrease The long-term real interest rate rises The higher real interest rate decreases consumption expenditure and investment. The exchange...
Figure 13-2 Real Interest Rate Supply of Loarable Funds World interest rate, o Derrand for Loanable...
Figure 13-2 Real Interest Rate Supply of Loarable Funds World interest rate, o Derrand for Loanable Funds Quantity of Loanable Funds Real Exchange Rate Supply of Canadian Dollars (5-1) Quantity of Dollars Refer to the Figure 13-2. If the interest rate was initially at ro and an import quota was imposed, what would happen to the real interest rate? It would decrease because demand would shift left. It would decrease because supply would shift right. It would not change because...
In September 2015, the unemployment rate was 7.0 percent, the inflation rate was 0.1 percent, and...
In September 2015, the unemployment rate was 7.0 percent, the inflation rate was 0.1 percent, and the overnight loans rate target was 0.5 percent. In September 2017, the unemployment rate was 6.2 percent, the inflation rate was 1.4 percent, and the overnight loans rate target was 1.0 percent. Why might the Bank of Canada decide to keep the overnight loans rate at 1 percent in 2018? The Bank of might decide to keep the overnight rate at 1 percent in...
Predict whether the following factors would cause the exchange rate of the Canadian dollar to strengthen...
Predict whether the following factors would cause the exchange rate of the Canadian dollar to strengthen or to weaken. Sketch a supply and demand diagram of the exchange rate market for the Canadian dollar to illustrate your answer. Interest rates go up in the United States Financial investors expect the Canadian dollar to depreciate in the next few months Canadian inflation falls relative to other countries Interest rates fall in Canada The Canadian dollar is below the PPP exchange rate
explain plz The indirect effect on Canadian inflation of an exchange rate appreciation O A. is...
explain plz
The indirect effect on Canadian inflation of an exchange rate appreciation O A. is inflationary O B. reinforces the direct effect. OC. can never offset the direct effect. OD. can sometimes offset the direct effect. O E. is equal and opposite to the direct effect. When the inflation rate is 4 percent, the Bank of Canada will bonds and the Canadian dollar will - O A. buy; appreciate OB. sell; expire O C. sell; appreciate O D. sell;...
The Bank of Canada often communicates its intentions to tighten or loosen monetary policy by announcing...
The Bank of Canada often communicates its intentions to tighten or loosen monetary policy by announcing a change in targets for: O prime interest rate. the velocity of money. O exchange rate. overnight lending rate.
Suppose the Bank of Canada raises the overnight loans rate. Describe the ripple effects of this monetary policy. Other short-term interest rates and the exchange rate Consumption expenditure, investment, and net exports The quantity of money and supply of loanable funds Aggregate demand Real GDP growth and the inflation rate O A. rise; increase OB. fall; decrease O c. fall; increase OD. rise; decrease O A. decreases; decrease OB. increases; decrease or remain the same O c. decreases; increase or...
Suppose that you go on vacation to Canada every summer. Last year, the hotel room where you stayed cost C$100 per night, and it costs the same this year. The exchange rate was 1.04 USS/C$ last year, and it is 0.95 US$/C$ this year. This means you will pay than you paid last year. per night this year The U.S. dollar-Canadian dollar exchange rate is essentially the price of a Canadian dollar in terms of U.S. dollars. When this price...
want to know the answer for both the
questions....thanksss ASAP
1. In The News: Bank of Canada increases overnight rate Canada increases overnight rate target to 14 per cent October 24, 2018- The Bank of Canada today increased its target for the to 1 34 per cent. The Bank Rate is correspondingly 2 per cent and y increased its target for the overnight rate 12 per cent is correspondingly 2 per cent and the deposit rate is 1 Questions: a)...
Describe the channels by which monetary policy ripples through the economy and explain how each channel operates. Suppose the Bank of Canada raises the overnight loans rate. When the Bank of Canada raises the overnight loans rate, it makes an open market Other short-term interest rates and the exchange rate rise. The quantity of money and the supply of loanable funds decrease The long-term real interest rate rises The higher real interest rate decreases consumption expenditure and investment. The exchange...
Figure 13-2 Real Interest Rate Supply of Loarable Funds World interest rate, o Derrand for Loanable Funds Quantity of Loanable Funds Real Exchange Rate Supply of Canadian Dollars (5-1) Quantity of Dollars Refer to the Figure 13-2. If the interest rate was initially at ro and an import quota was imposed, what would happen to the real interest rate? It would decrease because demand would shift left. It would decrease because supply would shift right. It would not change because...
In September 2015, the unemployment rate was 7.0 percent, the inflation rate was 0.1 percent, and the overnight loans rate target was 0.5 percent. In September 2017, the unemployment rate was 6.2 percent, the inflation rate was 1.4 percent, and the overnight loans rate target was 1.0 percent. Why might the Bank of Canada decide to keep the overnight loans rate at 1 percent in 2018? The Bank of might decide to keep the overnight rate at 1 percent in...
explain plz
The indirect effect on Canadian inflation of an exchange rate appreciation O A. is inflationary O B. reinforces the direct effect. OC. can never offset the direct effect. OD. can sometimes offset the direct effect. O E. is equal and opposite to the direct effect. When the inflation rate is 4 percent, the Bank of Canada will bonds and the Canadian dollar will - O A. buy; appreciate OB. sell; expire O C. sell; appreciate O D. sell;...
The Bank of Canada often communicates its intentions to tighten or loosen monetary policy by announcing a change in targets for: O prime interest rate. the velocity of money. O exchange rate. overnight lending rate.
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