An Open Economy Is One in Which Exports and Imports

question 103

True/False

An open economy is one in which exports and imports constitute a large share of GDP.

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Definitions:

Minimum Rate

The lowest acceptable rate of return on an investment, often used in the evaluation of projects or financial decisions.

Rate of Return

The gain or loss on an investment over a specified period, expressed as a percentage of the investment’s cost.

Net Present Value

A method used in capital budgeting to evaluate the profitability of an investment or project, calculating the difference between the present value of cash inflows and outflows.

Cash Inflows

The total amount of money being transferred into a business, typically from operating, investing, and financing activities.