Which of the Following Is an Important Factor in Exchange

question 106

Multiple Choice

Which of the following is an important factor in exchange rate movements in the very short run?

• A) Changes in relative GDPs.
• B) Changes in relative tastes for foreign goods.
• C) Changes in relative interest rates.
• D) Changes in inflation.
• E) None of the above.

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Definitions:

Capital Cost Allowance

A tax deduction in Canada for the depreciation of tangible property.

Deferred Tax

A tax liability or asset that arises due to temporary differences between the book value and tax value of assets and liabilities.

Deferred Tax Asset

A tax benefit that arises from temporary differences between the book and the taxable income, often due to allowances and deductions recognized at different times.

Consulting Fees

Charges imposed by consultants for their professional advice and services rendered to businesses.