The Table Given Below Reports the Inflation Rate in the U.S

question 94

Multiple Choice

The table given below reports the inflation rate in the U.S. and Canada for two years.
Table 8.1
$\begin{array}{|c|c|c|}\hline & \text { United States } & \text { Canada } \\\hline \text { Inflation Rate (year 1) } & 0 \% & 0 \% \\\hline \text { Inflation Rate (year 2) } & 0 \% & 3.6 \% \\\hline\end{array}$
-Refer to Table 8.1. Assume that the exchange rate is fixed at 1.4 CAD = $1 and that price changes for salmon are identical to the inflation rate in each country. If U.S. importers pay 10,000 CAD for a trailer of Canadian salmon in year 1, what is the approximate price of that salmon in year 2, given that exchange rates do not change?

• A) $10,360
• B) $14,504
• C) $7,400
• D) $7,143
• E) $10,000

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Definitions:

Amortization

The process of gradually writing off the initial cost of an intangible asset over a period, reflecting its consumption, expiration, or obsolescence.

Depreciation Adjustment

A financial reporting mechanism to allocate the cost of a tangible asset over its useful life.

Intra-Entity Asset Transfers

Transactions involving the transfer of assets from one segment of an organization to another within the same entity.

Excess Amortizations

Amortization expenses that are higher than what is considered normal or expected, often due to aggressive repayment of debt or intangible assets.