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A 1- year Canadian bond with a face value of 5000 can be purchased at 4800.
a) Calculate the nominal interest rate in Canada.
b) if the Canadian dollar is expected to depreciate against the US dollar by 1 % over the next year, calculate the current nominal interest rate in the US.
c) How much could an American bond with the same Face value as the Canadian bond sell in the market?
explain the practical application of differential costing with the help of suitable example.
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What do you mean by differential costing ? How it differ from marginal costing ? explain its practical application with examples?
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