What Is the Difference Between an Extraordinary Repair and a Betterment

question 58

Multiple Choice

What is the difference between an extraordinary repair and a betterment?

• A) A betterment extends the life of the asset; an extraordinary repair does not.
• B) An extraordinary repair is a capital expenditure; a betterment is not.
• C) An extraordinary repair may extend the life of the asset; a betterment does not.
• D) None of these answers is correct.

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Definitions:

EAFE Index

An index that measures the stock market performance of developed markets outside of the United States and Canada.

Non-U.S. Stocks

Shares of companies based outside of the United States, often used to diversify investment portfolios.

CAPM

The Capital Asset Pricing Model, a theory that describes the relationship between risk and expected return for assets, particularly stocks.

Exchange-Rate Risk

The potential for investors to experience losses due to changes in the exchange rate between two currencies in their foreign investment transactions.