in an open economy national saving equals domestic invest,ent plus net capital outflow. true or false

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Expert Solution

True,

When an economy is open its national saving equals to domestic investment plus the net capital outflow

It gives the value of the money invested in the home country rather than in the foreign country for the investment and longer returns from it

and net capital outflow happens when any county is investing its money abroad more than other foreign countries in their home

So both of these create a surplus and called national saving.

Rahul Sunny answered 2 years ago

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