The Case in Point on Betting on Natural Resource Prices

question 5

Multiple Choice

The Case in Point on Betting on Natural Resource Prices indicated that exhaustible resource prices:

• A) increased over time confirming the argument that we will run out of such resources.
• B) decreased over time confirming that substitutions, new discoveries, and new technologies outweigh increased demand.
• C) increased in developed countries and decreased in developing countries.
• D) have not followed a single, consistent pattern over time.

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Definitions:

Foreign Direct Investment

An investment made by a company or individual in one country in business interests in another country, in the form of establishing business operations or acquiring business assets.

Foreign Portfolio Investment

Investments in foreign countries' securities, such as stocks and bonds, without control over the management of those entities.

Net Capital Outflow

The difference between a nation's savings and its investment, representing the amount of domestic capital invested abroad minus the foreign capital invested domestically.

Pound Sterlings

The official currency of the United Kingdom, commonly known as the pound and denoted by GBP, which is one of the world's major currencies.