If domestic residents of France purchase 1.2 trillion euros of foreign assets and foreigners purchase 1.5 trillion euros of French assets,then France's net capital outflow is

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Quizplus · Accepted Answer

Net capital outflow is calculated as the difference between the purchase of foreign assets by domestic residents and the purchase of domestic assets by foreigners. Here, it is 1.2 trillion - 1.5 trillion = -0.3 trillion euros, indicating a net capital inflow, which corresponds to a trade deficit.

If Domestic Residents of France Purchase 1