In a Small Open Economy, If Domestic Saving Equals $50

question 38

Multiple Choice

In a small open economy, if domestic saving equals $50 billion and domestic investment equals $50 billion, then
There is and net capital outflow equals .
 

• A)a trade deficit; $100 billion
• B)balanced trade; $0
• C)a trade surplus; $100 billion
• D)balanced trade; $100 billion

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Definitions:

Command And Control

A traditional management approach where decisions and instructions come from the top of the organizational hierarchy and are strictly followed by lower levels.

Regulatory Agency

A governmental body responsible for exercising supervisory authority over specific areas of economic or social activity, ensuring compliance with laws and regulations.

Carbon Tax System

A tax levied on the carbon content of fuels to incentivize reduction in greenhouse gas emissions.

Tax Rate

The percentage at which income, transactions, or properties are taxed by a government authority.