Suppose the world had only two countries and domestic residents of country A purchased $50 billion of assets from country B and country B purchased $30 billion of from country A.What would the net capital outflows of both countries be?

Question

Quizplus · Accepted Answer

Net capital outflow is calculated as the difference between the value of assets purchased from abroad and the value of domestic assets purchased by foreigners. For country A, it is $50 billion - $30 billion = $20 billion. For country B, it is $30 billion - $50 billion = -$20 billion.

Suppose the World Had Only Two Countries and Domestic Residents