Foreign direct investment is any investment made in a country by residents outside that country.

Based on the Saving-Investment Diagram, if the world real interest rate is indicated by C, then ________

A) the difference between values H and D measures the net capital outflow B) the difference between values H and D measures the trade deficit C) the domestic real interest rate is indicated by B D) the difference between values H and F measures the trade deficit E) none of the above

Assuming a competitive world, does your country have a comparative advantage in making pizza? You can get your answer by

a. observing if your country makes more pizza than any other country b. comparing pizza prices in other countries c. calculating the opportunity cost of a pizza in your country d. comparing the opportunity cost of producing pizza in your country with the opportunity cost of producing pizza in other countries e. comparing your country's terms of trade to the terms of trade in other countries