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Why Does Continued Foreign Investment in U

question 175

Essay

Why does continued foreign investment in U.S.stocks and bonds and foreign companies continuing to build factories in the United States result in a current account deficit in the United States?


Definitions:

Savings Accounts

Deposit accounts held at financial institutions that provide principal security and a modest interest rate.

Deposit

The act of placing funds into a bank account or a sum of money that is held in custody for future transactions.

Simple Interest

The calculation of interest paid only on the original amount of money invested, not on the interest it has already earned.

Compounded Annually

Describes the process by which an investment's earnings, from either capital gains or interest, are reinvested to generate additional earnings over time.

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