Asked by Giansa Viola on May 29, 2024
Verified
Holding other things constant,a decrease in the inflation rate in the US compared to the Canadian economy may cause the demand for the US dollar to _____________ and the supply to __________.
A) Increase;decrease
B) Increase,increase
C) Decrease;Increase
D) Decrease;Decrease
Inflation Rate
The rate at which the general level of prices for goods and services is rising, eroding purchasing power.
Demand
The volume of goods or services that purchasers are ready and financially able to acquire at several price points within a certain period.
Supply
The total amount of a product or service that producers are willing and able to sell at a given price level in a given time period.
- Understand how changes in inflation rates between two economies affect the demand and supply of currencies.
Verified Answer
Learning Objectives
- Understand how changes in inflation rates between two economies affect the demand and supply of currencies.
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