Which of the Following Resulted in a Surge in International

question 13

Multiple Choice

Which of the following resulted in a surge in international lending to developing countries in the mid-1970s to early 1980s?

• A)Oil-exporting countries had a low short-run propensity to save out of their extra income.
• B)The real interest rates in the industrial countries were significantly high.
• C)The governments of the developing countries encouraged foreign direct investment (FDI) and foreign institutional investments (FII).
• D)Lending to developing countries gained momentum through "herding" behavior.

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Definitions:

Operating Cash Flow

A measure of the cash generated by a company's regular operational activities over a specific period.

Profit Margin

A financial metric that measures the percentage of revenue that exceeds the cost of goods sold, indicating how much profit a company makes on sales.

Depreciation Expense

The allocation of the cost of an asset over its useful life.

After-tax Salvage Value

The net value of an asset after it has been sold and all related taxes have been paid.