If Argentina suffers from capital flight, Argentinean domestic investment and Argentinean net exports will both decline.

Question

Quizplus · Accepted Answer

Capital flight typically leads to a depreciation of the local currency, which can make domestic investments more attractive to foreign investors due to lower costs in their home currency. Additionally, a weaker local currency makes exports cheaper and more competitive abroad, potentially increasing net exports.

If Argentina Suffers from Capital Flight, Argentinean Domestic Investment and Argentinean