Identify the Incorrect Statement Concerning the North American Free Trade

question 146

Multiple Choice

Identify the incorrect statement concerning the North American Free Trade Agreement (NAFTA) .

• A) NAFTA lays out a plan to reshape the rules of trade among the U.S., Canada, and Mexico.
• B) NAFTA enlarges the free-trade pact that had already knocked down most barriers to U.S.-Canada trade.
• C) Over a 15-year period, NAFTA has eliminated most barriers to U.S.-Mexico trade.
• D) NAFTA prohibits moving of production and jobs from the U.S. to Mexico.
• E) NAFTA establishes a forum for resolving future trade disputes.

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Definitions:

Promissory Note

A financial document in which one entity guarantees to pay a certain amount of money to another, either when asked or at an agreed-upon date in the future.

Discount Rate

The interest rate used in discounted cash flow analysis to determine the present value of future cash flows.

Canadian Consumer Price Index

A measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care, calculated by Statistics Canada.

Annual Rate of Inflation

The percentage increase in the cost of goods and services over a one-year period.