Canadian Economy and Trade Flashcards
6 cards from real CANADIAN practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Canadian Economy and Trade flashcards as text
Under the Canada-United States-Mexico Agreement (CUSMA), approximately what percentage of Canada's domestic dairy market was opened to American producers as part of the deal's resolution of the supply management dispute?
Answer: 3.59%
CUSMA granted U.S. dairy producers access to approximately 3.59% of the Canadian dairy market. Canada also agreed to eliminate its Class 7 (formerly Class 6) milk pricing system, which the U.S. argued suppressed American dairy exports. This was a core concession Canada made to secure the agreement in 2020.
Canada's supply management system, which governs dairy, poultry, and eggs, primarily operates through which combination of mechanisms?
Answer: Production quotas combined with high border tariffs on imports
Supply management relies on three pillars: (1) production quotas that limit how much farmers can produce, (2) domestic pricing controls, and (3) high import tariffs (sometimes exceeding 200%) that prevent foreign products from undercutting domestic prices. It is not funded by taxpayer subsidies — farmers themselves bear the cost of buying quota.
The economic phenomenon known as 'Dutch Disease,' sometimes discussed in the context of the Canadian economy, describes which scenario?
Answer: Currency appreciation driven by commodity export booms that erodes manufacturing competitiveness
Dutch Disease refers to the negative effect on a country's manufacturing sector when a booming resource-export sector drives up the national currency. A stronger Canadian dollar (often correlated with high oil prices) makes Canadian manufactured goods more expensive for foreign buyers, reducing export competitiveness. The term originated from the Netherlands' experience after natural gas discoveries in the 1960s.
How many countries are original signatories to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which Canada helped negotiate and ratified in 2018?
Answer: 11
The CPTPP has 11 original signatories: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. The agreement is the successor to the Trans-Pacific Partnership (TPP), which had 12 members — the United States withdrew in 2017, leaving the remaining 11 nations to renegotiate and sign the CPTPP.
The Bank of Canada's formal inflation-control target, renewed periodically with the Government of Canada, specifies an inflation rate of:
Answer: 2% midpoint within a 1–3% control range
The Bank of Canada targets a 2% inflation rate (as measured by CPI) and treats the 1–3% band as an acceptable range of variation. The midpoint of 2% is the actual operational target. This framework has been in place since 1991 and is renewed every five years through a joint agreement with the federal government.
Canada's long-running Softwood Lumber dispute with the United States has primarily resulted in the U.S. imposing which type of trade remedy against Canadian lumber exports?
Answer: Countervailing and anti-dumping duties on Canadian softwood lumber
The U.S. has repeatedly imposed countervailing duties (CVDs), arguing that Canadian provincial stumpage fee systems constitute an unfair subsidy, and anti-dumping duties, claiming Canadian lumber is sold below fair market value. These duties — sometimes combined exceeding 20% — have been contested at the WTO and under NAFTA/CUSMA panels multiple times, with mixed rulings. No complete ban has ever been imposed.