A Financing Gap Is

question 114

Multiple Choice

A financing gap is:

• A) the difference between an economy's savings rate and the amount of investment needed to achieve sustainable growth.
• B) the extra savings a country has beyond that needed to achieve sustainable growth.
• C) the difference between the amount of investment dollars coming into a country and the amount of investment dollars going out of the country.
• D) the extra investment developing countries need in foreign aid to sustain their current rate of growth.

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Definitions:

Buyers

Individuals or entities that purchase goods or services for personal use, resale, or production.

Income Elasticity of Demand

A measure of how the quantity demanded of a good changes in response to a change in consumers' income.

Inferior Good

A type of good whose demand decreases as the income of consumers increases, contrasting with normal goods.

Supply

The total amount of a good or service that is available for purchase at any given price.