Why do higher real interest rates lead to lower net capital outflow?
Higher domestic interest rates make domestic assets more desirable. So, domestic purchases of foreign assets decline while foreign purchases of domestic assets increase, both of which reduce net capital outflow.
Economics
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Which of the following is included in gross domestic product for an economy in a given year?
A) the value of intermediate goods produced in that year B) the value of used goods sold in that year C) the value of final goods produced in that year D) All of the above would be included in gross domestic product for an economy in a given year.
Economics
Cross elasticity of demand is:
A. Negative for complementary goods B. Negative for substitute goods C. Unitary for inferior goods D. Positive for inferior goods
Economics