If Domestic Saving Is Less Than Domestic Investment, Then Investment

question 102

Multiple Choice

If domestic saving is less than domestic investment, then investment is financed by:

• A) an inflation tax.
• B) nothing-it cannot be done.
• C) higher interest rates.
• D) foreign saving.
• E) printing more money.

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Definitions:

Void Contract

A contract that is legally unenforceable from the start due to illegality or inability to fulfill the terms.

Quasi-Contract

Not an actual contract but a legal construct imposed by courts to prevent unjust enrichment where no formal contract exists.

Unjustly Enriched

A legal term describing a situation where one party benefits at another's expense without a valid basis for the gain.

Statute of Limitations

Laws that set the maximum time after an event within which legal proceedings may be initiated.