The role of _______ is to direct one nation's savings into investments of another nation?
Correct answer: D. capital flows
- A. merchandise trade flows
- B. services flows
- C. current account flows
- D. capital flows
Explanation
Capital flows move financial resources across borders, allowing savings in one country to finance investment in another. Merchandise and services flows concern trade in goods and services rather than the direct movement of investment funds.
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About Macroeconomics
The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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