Measuring and analyzing the impact of economic variables on the nominal exchange rate in Canada Period (1990-2018)
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Abstract
The exchange rate is considered one of the most important economic variables, which plays an important role in the external economic activities of each country in the field of trade, investment, or others. By determining the most important factors that affect the Canadian dollar exchange rate, as it is a function of changes in inflation rates, total foreign debt, short-term interest rate, export value, foreign assets value, total government spending or expenditure at current prices, and the growth rate of gross debt product (GDP), and the value of imports. The study used the ordinary least squares method to estimate the function of the Canadian dollar exchange rate, and that the applied study used unit root tests to test whether the time series adopted in this study contain the unit root, through Augmented Dickey-Fuller tests, and that the Jarque test was relied upon. - Bera) to test the normal distribution of the model, and tests the quality of the model, including the correlation test between second-order errors (LM) and the conditional Autoregressive test for the conditional variance of errors (ARCH). With the aim of identifying and estimating a standard model to analyze the impact of the economic variables of the study on the behavior of the Canadian dollar exchange rate function, in addition to making some proposals. The research came out with a set of conclusions, including that the direct relationship between the value of imports and the exchange rate of the Canadian dollar, and there is an inverse relationship between the external debt, total spending, and the growth rate of the domestic product with the exchange rate of the Turkish lira.
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