If the World Real Interest Rate Is Less Than the Real

question 58

Multiple Choice

If the world real interest rate is less than the real interest rate that would occur in Canada if there was no trade, then how does Canadian net capital outflow change?

• A)It decreases.
• B)It increases.
• C)It does not change.
• D)There is not sufficient information to determine the change in capital outflow.

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Definitions:

Slave Economies

were economic systems that relied heavily on slave labor, particularly prevalent in the Americas before the abolition of slavery.

Cuba

An island nation in the Caribbean known for its significant history, including Spanish colonization, a communist revolution in 1959, and tense relations with the United States.

Brazil

The largest country in both South America and Latin America, known for its rich cultural heritage, biodiversity, and significant economic growth.

Republican Party

One of the two major contemporary political parties in the United States, also known as the GOP (Grand Old Party), founded in 1854 primarily to oppose the expansion of slavery into Western territories.