Figure 13-1

-Refer to the FigurE₁3-1.If the world interest rate equals 4 percent,what is the net capital outflow?
A)$4000
B)$2000
C)-$2000
D)-$4000

Question

Figure 13-1
 
-Refer to the FigurE₁3-1.If the world interest rate equals 4 percent,what is the net capital outflow?
A)$4000 
B)$2000 
C)-$2000 
D)-$4000

Quizplus · Accepted Answer

Net capital outflow is the difference between domestic saving and domestic investment. In this figure, domestic saving is $10,000 and domestic investment is $12,000, so net capital outflow is -$2,000 (meaning there is a flow of capital out of the country).

Figure 13-1 -Refer to the FigurE₁3-1.If the World Interest Rate Equals 4