Currencies and Exchange Rates Assignment

According to the graph, when would have been the best time for an American to buy a piece of machinery manufactured in Canada? Explain your answer in at least two complete sentences.

The best time to buy an imported good, such as machinery manufactured in Canada, is when you can buy the most Canadian dollars for your US dollars. According to the chart, rates were most favorable in March 2013. At that time, $1 could buy about 1.03 Canadian dollars.

What has the president of Venezuela done by devaluating the bolivar?

artificially increased the number of bolivars needed to buy one US dollar

For this table, the reference currency is the ______

euro

What is the expected effect of the devaluation among Venezuela's population?

rising inflation

The exchange rate of the euro to the US dollar and most other currencies is determined by ______

supply and demand

What is a currency exchange rate?

the value of one currency in relation to another

In October 2012, one US dollar could buy about ____ Canadian dollars.

0.98

Now, put it all together. Explain how a rise in currency value would affect a country's ability to import and export goods. Give your answer in at least two to three complete sentences.

If a country experiences a rise in value, it will trade at a higher exchange rate. This rise in value will cause the prices of exports to increase, so other countries may be less willing to buy these goods. At the same time, the rise in value will make it easier and cheaper to import goods.

The US dollar grew stronger against the Canadian dollar from _____

Jan. 2013 to Mar. 2013

According to the chart, one euro would buy ______ Swiss francs

1.2149

It would cost _____ US dollars to buy one euro

1.28

The exchange rate remained unchanged from _____________

Dec. 2012 to Jan. 2013