If the US Puts Tariffs on Canadian-Manufactured Products and Canada Has a Has

Multiple Choice

If the U.S. puts tariffs on Canadian-manufactured products and Canada has a flexible exchange, which of the following will occur?

A) Canadian interest rates will initially rise above the world interest rate
B) there will be no permanent effects on Canada's aggregate demand curve
C) Canadian net exports will increase in the long run
D) the Canadian dollar will permanently appreciate