Which of the following best defines capital flight?
A)the movement of workers across international borders in response to exchange rate changes
B)the movement of funds between financial intermediaries when interest rates change
C)the ability of investment expenditures to lift a country out of poverty
D)the large and sudden reduction in the demand for assets located in a country

Question

Quizplus · Accepted Answer

Capital flight refers to the situation where there is a large and sudden reduction in the demand for assets located in a country. This typically occurs when investors become concerned about the economic or political stability of a country, and as a result, they withdraw their funds or move them to safer investments in another country. This can have a significant negative impact on the economy of the country experiencing capital flight.

Which of the Following Best Defines Capital Flight