When the Sykes Corporation (an American company) buys shares of Audi stock (a German company) for its pension fund, U.S. net capital outflow
a. increases because an American company makes a portfolio investment in Germany.
b. declines because an American company makes a portfolio investment in Germany.
c. increases because an American company makes a direct investment in Germany.
d. declines because an American company makes a direct investment in Germany.
a
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Why is money you receive at some future date worth less to you than money you receive today?
What will be an ideal response?
The HO model predicts that once trade begins factor prices will equalize between countries. This result occurs because of the assumption of
A) identical technology sets available to each country. B) constant opportunity costs. C) one factor of production. D) free international mobility of factors.
Refer to the payoff matrix below, which ________ a prisoner's dilemma. If both countries cooperate, Home will choose Policy ________ and Foreign will choose Policy ________
A) is; 1; A B) is; 2; B C) is; 1; B D) is not; 2; B E) is not; 1; A
If the Fed decides to reduce bank reserves, it can
A) purchase government bonds. B) extend discount loans to banks. C) sell government bonds. D) print more currency.