Which of the Following Is Used to Describe an 'Open

question 76

Multiple Choice

Which of the following is used to describe an 'open' economy?

• A) one which has few or no barriers to international trade
• B) one that exports a small proportion of its output
• C) one that is open to technological ideas from other countries
• D) one that is open to immigration from other countries

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Definitions:

Discount Rate

This refers to the rate used in discounted cash flow assessments to figure out the current value of cash flows expected in the future.

Net Present Value

The difference between the present value of cash inflows and the present value of cash outflows over a period of time, used in capital budgeting to assess the profitability of investments.

Working Capital

The difference between a company's current assets and current liabilities, indicating the short-term liquidity and operational efficiency.

Discount Rate

In discounted cash flow analysis, it's the rate employed to calculate the present value of anticipated cash flows.