Which Statement Is Consistent with a Depreciation of the Dollar

question 175

Multiple Choice

Which statement is consistent with a depreciation of the dollar?

• A) Canadian goods become less expensive relative to foreign goods, which makes exports rise and imports fall.
• B) Canadian goods become less expensive relative to foreign goods, which makes exports fall and imports rise.
• C) Canadian goods become more expensive relative to foreign goods, which makes exports rise and imports fall.
• D) Canadian goods become more expensive relative to foreign goods, which makes exports fall and imports rise.

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Definitions:

Equivalent Annual Cost

A financial metric used to compare the cost-efficiency of different investments or projects with different lifespans, by calculating their annual costs.

Present Value

The present day value of an anticipated future amount of money or series of cash receipts, calculated with an established rate of return.

CCA Tax Shield

Refers to the reduction in taxable income for businesses through the deduction of depreciation on long-term assets.

Operating Cash Flow (OCF)

Cash generated from a company's regular business operations, indicating its ability to generate sufficient revenue to maintain operations.