A decrease in capital outflows from the United States will
A)decrease the balance on the financial account.
B)increase the balance on the financial account.
C)increase the balance on the capital account.
D)decrease the balance on the current account.

Question

Quizplus · Accepted Answer

Capital outflows refer to the flow of money from a country's economy to other economies. A decrease in capital outflows means that there is less money leaving the country, which results in an increase in the balance on the financial account. The financial account records all international purchases and sales of assets, such as stocks and bonds, and a decrease in the outflow of capital means that there are more purchases of assets in the US, leading to an increase in the financial account balance.

A Decrease in Capital Outflows from the United States Will