If the Interest Rate in Two Countries Were the Same

question 95

Multiple Choice

If the interest rate in two countries were the same, you would prefer to invest in assets of the country:

• A)​whose currency was likely to appreciate.
• B)​whose currency was likely to depreciate.
• C)​whose currency had the greatest exchange value.
• D)​none of the above; it would not matter what was likely to happen to a country's currency exchange rate.

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Definitions:

CCA Rate

Stands for Capital Cost Allowance rate, which is the rate at which a business can claim depreciation on capital assets for tax purposes in Canada.

UCC

An abbreviation for the Uniform Commercial Code, a set of laws governing sales and commercial transactions in the United States.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, representing how much of the asset's value has been used up during the period.

Net Capital Spending

The total expenditure on fixed assets less any sales of fixed assets.