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If a country has a positive net capital outflow, then Answer 1. on net it is pur

ID: 1235867 • Letter: I

Question

If a country has a positive net capital outflow, then
Answer
1. on net it is purchasing assets from abroad. This adds to its demand for domestically generated loanable funds.
2. on net it is purchasing assets from abroad. This subtracts from its demand for domestically generated loanable funds.
3. on net other countries are purchasing assets from it. This adds to its demand for domestically generated loanable funds.
4. on net other countries are purchasing assets from it. This subtracts from its demand for domestically generated loanable funds.

Explanation / Answer

1) option

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