If Net Foreign Investment in Canada Is Negative, How Must

question 268

Multiple Choice

If net foreign investment in Canada is negative, how must national saving and domestic investment be related?

• A)Domestic investment and national saving must also be negative.
• B)Domestic investment must be greater than national saving.
• C)Domestic investment must be less than national saving.
• D)Domestic investment can be greater than or less than national saving.
• E)Domestic investment is always unrelated to national saving.

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Definitions:

EPS

Earnings per share. A firm’s earnings stated on a per-share outstanding basis. An important measure of business performance in the stock market.

Equity

Ownership interest in a company, represented by shares that entitle holders to a share of the company's profits.

Financial Leverage

The use of borrowed money to multiply financial performance in terms of ROE and EPS.

Shareholders

Individuals or entities that own shares in a corporation, giving them partial ownership and possibly a right to vote at shareholders' meetings.