If Net Foreign Investment Is Positive,which of the Following Must

question 186

Multiple Choice

If net foreign investment is positive,which of the following must be true? (Assume that the capital account is zero and net transfers are zero.)

• A)Capital outflows are less than capital inflows.
• B)Domestic investment must be less than national saving.
• C)Net exports are negative.
• D)None of the above are true when net foreign investment is positive.

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Definitions:

Indifference Curves

Graphical representations used in microeconomics to show combinations of two goods that give a consumer equal satisfaction and utility.

Convex

A shape or curve that bulges outward or is thicker in the middle than at the edges, often used in economic models to describe certain types of preference or utility functions.

Marginal Utility

The increased satisfaction obtained from the consumption of an extra unit of a good or service.

Money Income

The total income received by an individual or household in monetary form from all sources before any taxes.