In an Open Economy, the Current Account Balance Equals ________

question 6

Multiple Choice

In an open economy, the current account balance equals ________.(Assume that the capital account is zero and net transfers are zero.)

• A)net foreign investment + domestic investment
• B)net capital outflows
• C)the financial account balance + net income on investments
• D)net foreign investment
• E)domestic saving

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Definitions:

Global Markets

The international exchange of goods, services, and finances, characterized by global competition, pricing, and product availability.

Economy

The system of production, distribution, and consumption of goods and services within a particular geographic region.

Climate Change

The alteration in global or regional climate patterns, attributed significantly to the increased levels of atmospheric carbon dioxide produced by the use of fossil fuels.

Geographic Shifts

Changes in the spatial patterns of phenomena on Earth, including population distributions, industry locations, and climate zones.