An Operational Asset Used for a Long Period of Time

question 137

True/False

An operational asset used for a long period of time is known as a capital asset.

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Definitions:

GIC

Guaranteed Investment Certificate; a Canadian investment that offers a guaranteed rate of return over a fixed period.

Maturity Value

The amount payable to an investor at the end of a fixed term investment, including principal and interest.

Monthly Compounded

A reiteration indicating that the interest accrues on a monthly basis, thereby increasing the investment or loan amount through compounding.

Promissory Note

A written and signed promise to pay a specified sum of money to a particular person or bearer on a specified date.