Why Do Political Instability and Insecure Property Rights Retard Economic

question 31

Multiple Choice

Why do political instability and insecure property rights retard economic growth?

• A) Fear that private property will be confiscated substantially reduces the incentive to invest and create wealth.
• B) When property rights are insecure, foreign investors will be reluctant to invest in the country.
• C) Savings will tend to flow out of a country if individuals fear their property is insecure.
• D) All of the above are correct.

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Definitions:

E-Commerce

The use of the Internet for performing business transactions.

Subsidiary Ledgers

Detailed records that support summary-level data contained in the general ledger, such as accounts receivable and accounts payable ledgers.

General Ledger

A complete record of all financial transactions over the life of a company.

Computerized Accounting Systems

Systems that use software to record, store, and process financial transactions and data, improving efficiency and accuracy in accounting.