| Appreciate | to increase, as when a currency's price rises in comparison to the price of another currency
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| Balance-of-payments deficit | a negative net balance on the balance-of-payments statement, demonstrating lower receipts than payments for the current and capital accounts combined; balanced with changes in official reserves
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| Balance-of-payments surplus | a positive net balance on the balance-of-payments statement, demonstrating greater receipts than payments for the current and capital accounts combined; balanced with changes in official reserves
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| Balance of trade | for both goods and services, receipts (inflows of Canadian dollars) less payments (outflows of Canadian dollars)
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| Capital account | the summary of all foreign transactions of financial assets involving Canadian dollars
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| Capital account deficit | a negative net balance in the capital account, demonstrating higher investments by Canadians in foreign markets than by foreigners in the Canadian economy
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| Capital account surplus | a positive net balance in the capital account, demonstrating lower investments by Canadians in foreign markets than by foreigners in the Canadian economy
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| Change in official reserves | use of the government's reserves of foreign currency to influence the international value of the Canadian dollar, as shown on the balance-of-payments statement
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| Current account | the summary of all foreign transactions associated with current economic activity in Canada and involving Canadian dollars
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| Current account deficit | a negative net balance in the current account resulting from lower receipts than payments for merchandise and nonmerchandise transactions
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| Current account surplus | a positive net balance in the current account resulting from higher receipts than payments for merchandise and nonmerchandise transactions
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| Demand for Canadian dollars | the relationship between the price of a Canadian dollar and the quantity demanded in exchange for another currency
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| Depreciate | to decrease, as when a currency's price falls in comparison to the price of another currency
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| Devaluation | a reduction in the value of a currency by the government that sets the exchange rate
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| Direct investment | financial investment (purchases of stocks) that gives the buyer of the financial assets a controlling interest in the institution issuing the assets
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| Fixed exchange rates | currency exchange rates set or "pegged" to a certain value by each country's government
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| Flexible exchange rates | currency exchange rates that are allowed to move freely to their equilibrium levels; also called floating rates
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| Foreign exchange market | the global market in which national currencies are traded
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| Managed float | a flexible exchange rate system that sometimes involves short-term government intervention
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| Merchandise balance of trade | merchandise export receipts minus merchandise import payments
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| Portfolio investment | financial investment (purchases of stocks and bonds) that does not give the buyer a controlling interest in the institution issuing the assets
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| Revaluation | an increase in the value of a currency by the government that sets the exchange rate
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| Speculators | individuals or organizations that buy and sell currencies for profit
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| Supply of Canadian dollars | the relationship between the price of a Canadian dollar and the quantity supplied in exchange for another currency
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2002 McGraw-Hill Higher Education