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Major Econ Topics (Basic Ideas and Equations (EFFECTS (Crowing Out Effect:…

- - - - Because NCO is down, Foreigners are investing in Canada and therefore need CAD $$$. Pushes demand up and appreciates the CAD $.
    - - Because NCO is up, Canadians are investing in other countries and need other $$$. Therefore supply of Canadian dollars goes up as Canadians demand others, and exchange rate falls.
    - - S = I + NCO
    - - Market for Foreign Currency exchange
  - - - Long-term deficits push up the interest rate and crowd out little investors. Therefore investment decreases and the economy slows down. Lower tax revenues results and more spending on income support programs. Even less money. VICIOUS CYCLE
    - - Long term surpluses decreases interest rate, encourage investment and economy grows. Leads to higher tax revenue and less spending on income support programs. Even more money. VIRTUOUS CYCLE
  - - - THERFORE S = I + NX
- - - - Better worker health 2. Lower worker turnover 3. Increased worker effort 4. Better worker quality