Which One of the Following Transactions Would Be Recorded as a Positive

question 108

Multiple Choice

Which one of the following transactions would be recorded as a positive entry in the Canadian balance of payment accounts?

• A)A Canadian tourist spends $3,000 while visiting France.
• B)A Canadian tourist spends $3,000 while visiting Banff.
• C)A Canadian citizen purchases a U.K. government bond.
• D)A Canadian corporation sends interest payments on outstanding bonds to U.S. citizens.
• E)A French tourist spends $3,000 while visiting Banff.

Understand and calculate terms of trade and its significance in international trade agreements.

Distinguish between the roles of comparative advantage and absolute advantage in international specialization and trade.

Recognize the contributions of key economists to the theory of comparative advantage.

Evaluate the impact of specialization and trade on the production possibilities of countries.

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Definitions:

Financial Synergy

The potential increase in value and performance of two companies when they are merged, due to various factors like cost savings or revenue enhancement.

Pro Forma Cash Flows

Projected cash flows based on assumptions and estimates, used for planning and financial analysis.

Required Rate of Return

The minimum annual percentage earnings necessary for an investment to be considered acceptable, taking into account its risk and the time value of money.

Financial Merger

A financial merger is a consolidation of two or more companies, primarily for financial gains, improving capital, or enhancing corporate strength through combined resources.