A nation's domestic investment is greater than its savings. Which of the following is correct?
a. This nation has a negative net capital outflow.
b. This nation has a trade surplus.
c. Purchases of foreign assets by domestic residents exceed purchases of domestic assets by foreigners.
d. All of the above are correct.
a
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Although all points on the production possibilities frontier are efficient, that alone does not determine which point is “best” for the society.
Answer the following statement true (T) or false (F)
If stock exchanges did not exist,
A. the risk to the investor of buying stocks would be much greater. B. the economy’s resources could be more efficiently allocated among firms. C. there would be no organized way for firms to issue stock. D. investment banks would no longer play a role in handling stocks.
In the above figure, the economy is initially at point B. If the Fed decreases the quantity of money, there is
A) a movement to point C. B) a movement to point A. C) a shift to AD2. D) a shift to AD1.
The putting up of outside collateral is
A) one form of the moral hazard problem. B) one form of the adverse selection problem. C) a signal of a high-quality borrower. D) a signal of a low-quality borrower.