You are the CEO of a U.S. firm considering building a factory in Chile. If the dollar appreciates relative to the Chilean peso, then other things the same
a. it takes fewer dollars to build the factory. By itself building the factory increases U.S. net capital outflow.
b. it takes fewer dollars to build the factory. By itself building the factory decreases U.S. net capital outflow.
c. it takes more dollars to build the factory. By itself building the factory increases U.S. net capital outflow.
d. it takes more dollars to build the factory. By itself building the factory decreases U.S. net capital outflow.
a
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When the price of a burrito increases from $2 to $4, the quantity demanded decreases from 50 to 40. Using the midpoint method, the price elasticity of demand equals
A) 1/3. B) 3. C) 2. D) 1. E) 1/2.
Why might private investment in poor countries, rather than aid by foreign governments and international agencies, contribute more effectively to economic growth?
A) Private investment is more consistent with central economic planning. B) Technical assistance is often part of the private investment package. C) Private investment is always selfish. D) Private investors are smarter and more street-wise than public authorities.