An Open Economy with a Low Saving Rate (Private and Public)

question 10

Multiple Choice

An open economy with a low saving rate (private and public) must have:

• A) a current account deficit only.
• B) low investment or a current account surplus.
• C) low investment only.
• D) a current account surplus only.
• E) low investment or a current account deficit.

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Definitions:

Direct Regulation

Governmental control directly imposed on specific activities, sectors, or behaviors to enforce compliance with laws and standards.

Technology Forcing

A policy or regulation that requires the development of new technology to meet a specific standard.

Marketable Discharge Permits

Tradable permits allowing the holder to emit a certain amount of pollutants, aimed at reducing the overall impact on the environment.

Carbon Emissions

The release of carbon dioxide into the atmosphere, mainly from burning fossil fuels for energy, which contributes to global warming and climate change.