When a country experiences capital flight its
a. net capital outflow increases and its real exchange rate rises.
b. net capital outflow increases and its real exchange rate falls.
c. net capital outflow decreases and its real exchange rate rises.
d. net capital outflow decreases and its real exchange rate falls.
b
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The effective use of coercion in a society ultimately depends upon
A) fear. B) free enterprise. C) police enforcement. D) voluntary cooperation.
Incumbents are unaffected by fixed costs of entry while potential entrants are affected by them because
A) for potential entrants the cost is avoidable, while for the incumbent, it is not. B) fixed costs will be greater for the potential entrant than for the incumbent. C) fixed costs are zero for the incumbent. D) incumbents will act to prevent entry at all costs.