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If the Canadian Real Exchange Rate Appreciates Relative to the Euro

Question 10

Multiple Choice

If the Canadian real exchange rate appreciates relative to the euro, which of the following best describes the consequences?


A) Canadian exports to Europe and European exports to Canada both rise.
B) Canadian exports to Europe and European exports to Canada both fall.
C) Canadian exports to Europe rise, and European exports to Canada fall.
D) Canadian exports to Europe fall, and European exports to Canada rise.

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