Between 1981 and 1988, what caused most of the change in Canadian net capital outflow as a percent of GDP?
A) decrease in Canadian investment
B) decrease in Canadian national saving
C) increase in Canadian investment
D) increase in Canadian national saving

Question

Quizplus · Accepted Answer

Net capital outflow as a percent of GDP is influenced by both investment and national saving. However, the question asks for what caused most of the change between 1981 and 1988, and the answer to that is a decrease in Canadian national saving. This is because a decrease in national saving would result in less domestic funds being available for investment, which in turn would lead to an increase in net capital outflow.

Between 1981 and 1988, What Caused Most of the Change