Which of the Following Factors Would Be Most Likely to Encourage

question 34

Multiple Choice

Which of the following factors would be most likely to encourage investment and capital formation in a less-developed nation?

• A) High and variable rates of inflation.
• B) Tariffs and quotas that restrict international trade.
• C) A legal system that provides for secure property rights and evenhanded enforcement of contracts.
• D) High marginal tax rates.

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Definitions:

Seize Security

The act of taking possession of collateral or assets to satisfy a debt or enforce a legal judgment.

Personal Property Security Act

Legislation providing rules for the creation and registration of security interests in personal property as a way to secure payment or performance of an obligation.

Secured Transactions

Secured transactions are financial arrangements in which an asset is pledged as collateral for the loan, providing security to the lender that the borrower will fulfill the terms of the loan agreement.

Encumbrances

Legal claims or liens on property or assets that may restrict their use or transfer.