--> Canada's CPI was 132.6 in January 2019 and 136.4 in January 2020. Calculate Canada's CPI inflation rate between January 2019 and January 2020. Show how you have obtained your answer.

--> A set of earphones sells for US$12.25 (American dollars) on amazon.com (the US-based retailer). The same set of earphones sells for CA$14.99 (Canadian dollars) on amazon.ca (the Canadabased retailer). Both retailers offer free shipping to anywhere in North America

a) If the exchange rate were 0.95 US$/CA$ (that is, 1 Canadian dollar buys 95 US cents), which retailer would the customers buy the earphones from? Show how you arrived at your conclusion.

b. If the Canadian dollar has depreciated and the exchange rate has become 0.55 US$/CA$ (that is, 1 Canadian dollar buys 55 US cents), which retailer would the customers buy the earphones from? Show how you arrived at your conclusion.

c. Generalize what you learn from this exercise. Specifically, what happens to the Canadian imports and exports when the Canadian dollar depreciates and why?