In the 1980s national savings declined as a percentage of GDP.Assuming that domestic private investment's percentage share has not declined,this situation requires,ceteris paribus,

Question

Quizplus · Accepted Answer

Since national savings have declined while domestic private investment has stayed constant, there is a savings-investment gap. This gap must be filled by net foreign investment, which means that net foreign investment (NX) must increase to cover the gap. Therefore, Choice B is the correct answer. Neither U.S. exports nor A and C are necessary outcomes.

In the 1980s National Savings Declined as a Percentage of GDP.Assuming