Answer to Question #63878 in Macroeconomics for Saifa Sodhi

Question #63878
Explain, with the aid of an example, why under a flexible exchange rate Canada can have lower interest rates than the United States.
1
Expert's answer
2016-12-07T08:12:12-0500
Because flexible exchange rate is able to attract inflow of foreign capital into the country, which will lower the interest rates in a national economy.

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