An Increase in the Budget Deficit

question 114

Multiple Choice

An increase in the budget deficit

• A)reduces net capital outflow and domestic investment.
• B)reduces net capital outflow and raises domestic investment.
• C)raises net capital outflow and domestic investment
• D)raises net capital outflow and reduces domestic investment.

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Definitions:

Interest Rate

The percentage of a sum of money charged for its use, typically expressed as an annual rate.

Interest Rate

The percentage of principal charged by the lender for the use of its money.

Interest Rate

The fraction of a loan amount charged as interest to the borrower, often shown as an annual percent of the outstanding loan.

New Capital

Additional funds or assets put into a business by the owners or investors intended for the expansion or improvement of the enterprise.