Which of the Following Statements Is Incorrect for an Open

question 123

Multiple Choice

Which of the following statements is incorrect for an open economy?

• A)A country can have a trade deficit,trade surplus,or balanced trade.
• B)A country that has a trade deficit has positive net capital outflow.
• C)Net exports must equal net capital outflow.
• D)National saving equals domestic investment plus net capital outflow.

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Definitions:

Uncollectible

Refers to accounts receivable that are considered to be uncollectable from debtors due to their inability to pay.

Credited

A term used in accounting to denote an increase in liabilities or equity accounts, or a decrease in assets or expense accounts.

Financial Assets

Assets that derive value from a contractual claim, such as cash, stocks, bonds, and bank deposits.