scroll to top
Stuck on your essay?
Get ideas from this essay and see how your work stacks up
Word Count: 1,287
The Canadian dollar has declined by over thirty percent versus the United States dollarsince it was at its highest in 1970 The reason for this is mainly the following factors theQuebec factor the inflation factor the productivity factor the growth in government and taxesfactor and the commodity price factor These all come together to bring us to what theCanadian dollar is worth compared to the US dollar todayThe Quebec factor is partly responsible for the decline It is no coincidence that theCanadian dollar began its descent to 69 cents in November 1976 That was the month in whichthe Parti Quebecois shocked political observers by winning the Quebec provincial election Itwas the first and still only party explicitly committed to separation to assume the reins of powerin Quebec City While it is generally agreed that there is a risk premium built into the Canadiandollar because of the threat of separation no one believes that threat is responsible for thewhole or even the bulk of the currencys decline The Canadian dollar is much lower because of separation because of what happenedduring the 1980 Quebec referendum At the beginning of the campaign in March 1980 pollsshowed the Yes side leading In response the Canadian dollar very quickly dropped from 87cents to 83 cents But in May when the No side won a resounding 60-40 per cent victory overthe separatists the Canadian dollar leaped back up It was at 87 cents again in June Thecurrencys movement in that period suggests a minimum 4 cent risk premium because of This is roughly consistent with what happened in the subsequent October 1995referendum On the night of the referendum the television networks were showing the Yes sidewith a substantial lead The Canadian dollar immediately dropped a cent Then however thevotes from Montreal were counted and the momentum began to swing strongly towards the Noside Over the next several days the Canadian leaped 3 cents to 75 cents Inflation means that
@Kibin is a lifesaver for my essay right now!!
- Sandra Slivka, student @ UC Berkeley
Wow, this is the best essay help I've ever received!
- Camvu Pham, student @ U of M
If I'd known about @Kibin in college, I would have gotten much more sleep
- Jen Soust, alumni @ UCLA