A Speech on Trade Alliances (Scenario)

question 98

Multiple Choice

A Speech on Trade Alliances (Scenario)
As manager of the international department for your company, you have been asked by the local Chamber of Commerce to deliver a speech on global trade. The presentation should include an overview of the world's major trade alliances and mechanisms that promote global trade. The Chamber president has also asked you to comment on a recent quote by a local politician, who stated: "NAFTA has been a bad deal for Canada and it continues to weaken our economy." As you review your notes, you wonder how you will fit all the information into the allotted half-hour presentation time!
-In response to the politicians' comments about NAFTA,you will point out that many economists would ________.

• A)agree because only the U.S.has achieved a stronger economy through NAFTA
• B)agree because only Mexico has achieved a stronger economy through NAFTA
• C)agree because both the U.S.and Mexico have achieved stronger economies through NAFTA,while Canada has not
• D)disagree because Canada,the U.S.,and Mexico have all achieved stronger economies through NAFTA

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Definitions:

Non-Interest-Bearing Note

A financial instrument that does not accrue interest over time, meaning the borrower pays back only the principal amount borrowed.

Discount Rate

The interest rate charged by central banks on loans to commercial banks or the rate used in discounted cash flow analysis to determine the present value of future cash flows.

Cash Discounts

A reduction in the price of goods or services offered to customers as an incentive for early payment within a specified period.

Interest Days

The number of days over which interest accrues on a loan, deposit, or investment.