Suppose That the Real Return from Operating Factories in Australia

question 66

Multiple Choice

Suppose that the real return from operating factories in Australia rises relative to the real rate of return in Canada.What are the effects of this transaction?

• A) This will increase Canadian net capital outflow and decrease Australian net capital outflow.
• B) This will decrease Canadian net capital outflow and increase Australian net capital outflow.
• C) This will only affect Canadian net capital outflow.
• D) This will only affect Australian net capital outflow.

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Definitions:

Establishing Prices

The process of determining the selling price of goods or services, taking into account factors like costs, market demand, competition, and desired profit margins.

Regulating

The process of controlling or governing according to rules or principles, often carried out by a governmental body.

Price Discount

A reduction from the usual cost of an item or service, used as a strategy to increase customer purchases or reduce inventory.

Anticipation Inventory

Stocks held in anticipation of customer demand, allowing companies to meet consumer needs without delay.