65. What happens in the foreign exchange market when there is a Canadian export transaction?

66. What happens in the foreign exchange market when there is a Canadian import transaction?

67. Explain how a nation might persistently import more goods than it exports and still maintain equilibrium in its balance of payments.

68. What is the difference between a fixed exchange rate system and a flexible (floating) exchange rate system?

69. Explain how the dollar price of an imported good may change even though the foreign production cost of that product remains unchanged.

70. List and explain the major determinants of the demand for, and supply of, the money of a foreign nation.

71. What is meant by currency appreciation?

72. Describe the three major disadvantages of flexible exchange rates.

73. Explain how the exchange rate gets determined in a flexible exchange rate system.

74. How are flexible exchange rates used to eliminate a balance of payments deficit or surplus?

75. How does a fixed exchange rate system work? How can a nation maintain its fixed exchange rate?