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:

Economic Organization

The structured systems and processes through which goods and services are produced, distributed, and consumed within an economy.

Unrelated Parts

Unrelated parts refer to components or elements that do not have a direct connection or association with each other within a specific context or system.

Extreme Behavior

Actions or conduct that significantly deviate from the social norms and expectations of a particular society or community.

Conflict Perspective

A sociological approach that views societal relationships as defined by tension and struggle between groups.