What Is the Problem with Saving in DVCs, Even When

question 159

Multiple Choice

What is the problem with saving in DVCs, even when saving as a percentage of domestic output is the same as in industrially advanced countries?

• A) The interest rate paid on money kept in a bank in DVCs is not as high as the interest rate on money kept in a bank in an IAC.
• B) Capital flight reduces investment opportunities and the need for saving in DVCs.
• C) There is a continual brain drain that removes skilled labor from the work force and reduces labor productivity and the need for saving.
• D) The domestic output of DVCs is so low that the absolute volume of saving is small.

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Definitions:

Area

A quantity expressing the two-dimensional size or extent of a shape or surface, typically measured in square units.

Variance

A measure of dispersion in a set of data points, calculated by taking the average of the squared differences from the mean.

Standard Deviation

A statistic that quantifies the dispersion or variability of a dataset, measuring the average distance between each data point and the mean.

Z-score

A quantitative measure that demonstrates the correlation of a specific value to the mean of a dataset, identifying its separation from the mean by counting the standard deviations.