According to the Saving and Investment Equation, If Net Foreign

question 3

Multiple Choice

According to the saving and investment equation, if net foreign investment rises by $35 million:

• A)national saving in excess of domestic investment will increase by $35 million.
• B)national savings will increase by $35 million.
• C)domestic investment will fall by $35 million.
• D)national saving in excess of domestic investment will decrease by $35 million.

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Definitions:

Depletion

The gradual exhaustion of natural resources, such as minerals, forests, or oil reserves, as these resources are extracted or used.

Natural Resource

Materials or substances occurring in nature which can be exploited for economic gain, like minerals, forests, water, and fertile land.

Asset Disposal

The process of selling, donating, scrapping, or otherwise getting rid of an asset that a business no longer intends to use.

Gain

An increase in equity from incidental transactions and other events affecting the entity during a period, except those that result from revenues or investments by owners.