Investment will occur in an open economy more often than in a closed economy because:
A) investment decisions have fewer constraints because investors and borrowers will compare the marginal product of capital in any nation with the world real interest rate.
B) without information, investors often make poor investment decisions.
C) governments like to subsidize overseas investment for domestic firms.
D) international financial organizations prefer to lend for international investments rather than domestic ones.
Correct Answer:
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