Which of the Following Statements Is True

Multiple Choice

Which of the following statements is true?

A) The effective exchange rate compares the value of the Canadian dollar in terms of the average value of the currencies of all countries with which Canada trades.
B) The effective exchange rate compares the value of the Canadian dollar in terms of the average growth rates of all countries with which Canada trades.
C) The effective exchange rate compares the value of the Canadian export prices in terms of the average export prices of all countries with which Canada trades.
D) The effective exchange rate compares the value of the Canadian import prices in terms of the average import prices of all countries with which Canada trades.
E) The effective exchange rate compares the value of the Canadian export and import prices in terms of the average export and import prices of all countries with which Canada trades.