Most of the money that we pay to foreigners to finance our current accounts deficit
A. flows back to the U.S. in investment funds.
B. stays abroad where it circulates as currency.
C. ends up in the hands of drug dealers.
D. is used by foreign governments as reserves.
A. flows back to the U.S. in investment funds.
You might also like to view...
During the global financial crisis of 2008, as more people started selling their houses in fear of falling house prices, the house prices fell further. This is an example of a(n) ________
A) pecuniary externality B) positive externality C) information cascade D) moral hazard
A firm that can sell essentially the same product with the same quality under different brand names that have different perceived quality, the firm
A) has a moral hazard problem. B) creates noise in the market. C) creates an arbitrage opportunity. D) is engaging in unfair trading practices.