What happens when the dollar depreciates?
A) Canadian exports and imports increase.
B) Canadian exports increase, while imports decrease.
C) Canadian exports decrease, while imports increase.
D) Canadian exports and imports decrease.

Question

Quizplus · Accepted Answer

When the dollar depreciates, it becomes cheaper for other countries to buy goods from Canada, leading to an increase in Canadian exports. Conversely, it becomes more expensive for Canadians to buy foreign goods, resulting in a decrease in imports.

What Happens When the Dollar Depreciates