11. A country has $70 billion of exports, domestic investment is $390 billion and $415 billion...

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Question

11. A country has $70 billion of exports, domestic investment is $390 billion and $415 billion...

11. A country has $70 billion of exports, domestic investment is $390 billion and $415 billion of saving. Therefore,

A. net capital outflow is positive $25 billion.

B. domestic investment is negative $25 billion.

C. domestic investment is positive $95 billion.

D. domestic investment is negative $95 billion.

E. None of the above is correct.

6. Other things the same, which of the following could explain a rise in Russia’s net capital outflow?

A. interest rates on Russian bonds rise

B. the probability of default on Russian bonds rises

C. Russia enacts a law reducing taxes on income earned by foreign-owned businesses operating in Russia

D. All of the above

E. A and B, only.

business economics

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Answer 1

Answer #1

Ans) the correct option is A. net capital outflow is positive $25 billion.

Net capital outflow = 415 - 390 = 25

Ans) the correct option is b) the probability of default on Russian bonds rises

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Answer 2

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