Which of the Following Statements Is True of NAFTA

question 38

Multiple Choice

Which of the following statements is true of NAFTA?

• A) It introduced a common currency for trade between the U.S., Mexico and Canada.
• B) It overrode the local content requirements and rules of origin for products manufactured in the member nations.
• C) It eliminated all tariffs and nontariff trade barriers on goods originating from within North America.
• D) It called for stringent rules regarding government procurement practices and the imposition of countervailing duties.

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Definitions:

Marginal Tax Rates

Marginal tax rates are the rates of tax applied to the next dollar of income, used to determine the tax impact of additional income or deductions.

Total Tax

The sum of all taxes levied on an individual or a corporation by various governmental agencies.

Provincial Tax Brackets

These refer to the range of income segments taxed at different rates by provincial governments in countries like Canada, where taxation powers are shared between federal and provincial authorities.

Net Working Capital

The difference between a company’s current assets and its current liabilities, indicating the liquidity of the business.