Suppose the United States, Canada's largest trading partner, imposes tariffs on Canadian products. This has the effect of making Canadian ?oods more expenswe in the United States. Explain how such a trade policy would affect the aggregate-demand curve in Canada under each of the following conditions. and. The Bank of Canada has adopted a flexible exchange rate. b. The Bank of Canada has adopted a fixed exchange rate

QUESTION 2 Suppose the United States, Canada's largest trading partner, imposes tariffs on Canadian products. This has the effect of making Canadian goods more expensive in the United States. Explain how such a trade policy would affect the aggregate-demand curve in Canada under each of the following conditions. a. The Bank of Canada has adopted a flexible exchange rate. b. The Bank of Canada has adopted a fixed exchange rate