In an open economy, national savings can be _______ investment.
A) more than
B) less than
C) equal to
D) All of these are true.

Question

Quizplus · Accepted Answer

In an open economy, national savings can be more than, less than, or equal to investment. This is because in an open economy, capital flows can occur between countries, meaning that a country can finance its investment through foreign savings if its national savings are insufficient, or it can lend its excess savings abroad if its domestic investment is low. Therefore, all of the choices are true.

In an Open Economy, National Savings Can Be _______ Investment