If a country were to save more,but its domestic investment remained the same,then which of the following would rise?
A)both net capital outflow and net exports
B)net capital outflow but not net exports
C)net exports but not net exports
D)neither net exports nor net capital outflow

Question

Quizplus · Accepted Answer

When a country saves more and domestic investment remains unchanged, the excess savings lead to an increase in net capital outflow, as the surplus savings are invested abroad. This also results in an increase in net exports, as the country exports more capital than it imports.

If a Country Were to Save More,but Its Domestic Investment