Question

Why are investment and savings so low in developing countries?

Instructions: You may select more than one answer. Click the box with a check mark for correct answers and click to empty the box for the wrong answers.

	The underdeveloped financial sector leaves the middle class with few opportunities to invest their savings.

	The rich often keep their savings abroad due to the fear of political instability.

	Income is low, and poor people don’t have a whole lot left over to save.

Interest rates in developing countries are notoriously low.

Answer 1

Investment and saving are low in developing countries are low because the level of income is low implies more is spend on consumption implies low saving and very low incentive to invest. Also, the financial market is underdeveloped in the developing countries leads to few opportunities to invest in the middle class.

the correct options are (a),(c)