Purchasing power parity

[@ztk5116]

Why would Canadians sell fewer exports to the US when 1us cocacola equal 0.5 Canada Coca-Cola

[@EnhanceTuition]

Because Americans can get more for their money in the US. They can either buy 1 US Coca-Cola or 1/2 a Canadian Coca-Cola. So would you rather purchase 1 item in the US OR just half of the same item in Canada using the same amount of money?

[@ztk5116]

@@EnhanceTuition Thank you.

[@tristanditobias4111]

if canada exports more to the us, and imports less from the us. why will it increase the demand for the canadian dollars and increase the supply for the us dollar?

[@EnhanceTuition]

To buy Canadian products you need Canadian dollars. The demand for Canadian dollars will rise and the US dollar will increase in supply on the foreign exchange market - US Americans supply their dollars in exchange for Canadian dollars.

[@tristanditobias4111]

@@EnhanceTuition thanks for the great explanation, have a great day!