Two Reasons Why Capital May Not Flow to Poor Countries

question 84

Multiple Choice

Two reasons why capital may not flow to poor countries are that the poorer countries may:

• A) have economies unlike those described by a Cobb-Douglas production function and not be subject to diminishing returns to capital.
• B) have already accumulated high levels of capital relative to labor and may already have access to advanced technologies.
• C) legally prevent the inflow of foreign capital and provide strong legal protection of private property.
• D) have inferior production capabilities and not enforce property rights.

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Definitions:

Orientation Session

A meeting or seminar designed to introduce new members, employees, or participants to organization policies, goals, and procedures.

Bottleneck Station

A stage in a production or work process that limits overall capacity due to its lower speed or efficiency compared to other stages.

Complementary Product

Products that enhance the value or utility of another product when used together.

Demand Management

The process of forecasting, planning, and controlling demand for products and services to optimize supply chain performance.