When a U.S.firm sells a good abroad for,say,100 euros (assume $1.5=1euro) ,U.S.net exports increase by $150.These $150 in exports can be accounted for as $150 increase in capital outflow because ________.
A) private consumption in the foreign country increases by $150
B) if the U.S.firm uses the 100 euros to buy a share of stock in a foreign firm,the firm is supplying U.S.capital to that foreign firm
C) if the U.S.firm uses the proceeds to buy a U.S.bond,capital investment in the foreign country has increased
D) all of the above
E) none of the above
Correct Answer:
Verified
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