Answered

If domestic investment is less than domestic savings, then

Select the correct answer below:
A. exports are less than imports
B. exports are greater than imports
C. investors will not have enough capital
D. there will be a net inflow of financial capital



Answer :

GinnyAnswer

Final answer:

When domestic investment is lower than domestic savings, there will be a net inflow of financial capital and the surplus will be invested abroad.


Explanation:

In this scenario, if domestic investment is less than domestic savings, it indicates that there will be a net inflow of financial capital into the country. This means that the extra financial capital will be invested abroad due to the imbalance between domestic savings and investment.


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