In a Small Open Economy, If Exports Equal $20 Billion

question 91

Multiple Choice

In a small open economy, if exports equal $20 billion, imports equal $30 billion, and domestic national saving equals $25 billion, then net capital outflow equals:

• A) -$25 billion.
• B) -$10 billion.
• C) $10 billion.
• D) $25 billion.

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Definitions:

Economic Events

Economic events are transactions or occurrences that affect the financial position of an entity and can be reliably measured.

Period Cost

Expenses that are not directly tied to the production process and are instead accounted for in the period they occur.

Product Cost

The total of costs directly assigned to the production of goods sold by a company, including materials, labor, and overhead.

Salespersons

Individuals who sell products or services for a company, often working on commission and responsible for generating revenue for the business.