Most of the change from 2000 to 2004 in U.S.net capital outflow as a percent of GDP was due to a(n)
A)decrease in U.S.investment.
B)decrease in U.S.national saving.
C)increase in U.S.investment.
D)increase in U.S.national saving.

Question

Quizplus · Accepted Answer

Net capital outflow is the difference between U.S. domestic investment and U.S. national saving, expressed as a percentage of GDP. Therefore, a decrease in U.S. national saving would result in an increase in net capital outflow, while an increase in U.S. investment would also result in an increase in net capital outflow. Since the question asks about the change from 2000 to 2004, and the answer choices only include either a decrease or an increase in U.S. investment and national saving, it can be inferred that the change in U.S. net capital outflow as a percent of GDP during this time period was primarily due to a decrease in U.S. national saving. Thus, option B is the correct answer.

Most of the Change from 2000 to 2004 in U