The Transaction Costs of Investing Directly in Foreign-Currency-Denominated Assets Can

question 81

True/False

The transaction costs of investing directly in foreign-currency-denominated assets can be reduced by purchasing American Depositary Shares (ADSs).

---

Definitions:

CCA Tax Shield

A tax benefit derived from the depreciation expense allowed on tangible property for tax purposes, reducing taxable income.

Class 8 Equipment

Heavy-duty machinery typically used in the transport and logistics industry, such as 18-wheel trucks.

Tax Rate

The chunk of income designated by the government to be taken as tax from corporations or the public.

CCA Rate

Capital Cost Allowance rate, which is the percentage rate at which Canadian businesses can claim depreciation on assets for tax purposes.