A Small Country Is a Net Foreign Lender and Its

question 7

Multiple Choice

A small country is a net foreign lender and its supply of loanable funds increases. As a result, the equilibrium quantity of loanable funds used in the country ________ and the country's foreign lending ________.

• A)increases; does not change
• B)increases; decreases
• C)does not change; does not change
• D)does not change; increases

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Definitions:

Profit Margin

A profitability ratio calculated as net income divided by revenue, showing the percentage of profit made from sales.

Income From Operations

The profit realized from a business's operational activities, calculated before taxes and interest are deducted.

Profit Margin

A financial metric that measures the percentage of revenue remaining after all expenses, taxes, and costs have been deducted.

Return On Investment

A performance measure used to evaluate the efficiency or profitability of an investment, calculated by dividing net profit by the cost of the investment.