"Countries are poor because they cannot afford to save and invest" is called the:
A) vicious circle of poverty.
B) savings-investment trap.
C) LDC trap.
D) cycle of insufficient credit.

Question

Quizplus · Accepted Answer

The "vicious circle of poverty" theory suggests that countries are poor because they cannot afford to save and invest, which in turn keeps them in a state of poverty. This cycle makes it difficult for these countries to break out of poverty without external intervention.

"Countries Are Poor Because They Cannot Afford to Save and Invest