It is not surprising that financially open economies are able to:
A) enjoy higher levels of consumer spending.
B) recycle investment funds by repaying interest with increased income from production.
C) delink savings and investment, thus increasing consumption smoothing.
D) get lower rates of interest on borrowing.

Question

Quizplus · Accepted Answer

Financially open economies can access international capital markets, allowing them to separate domestic savings from investment, which facilitates consumption smoothing over time.

It Is Not Surprising That Financially Open Economies Are Able