66.1k views
4 votes
How does the bottom portion of showing the international flow of investments and capital differ from the upper portion?

a) It reflects consumer spending patterns
b) It demonstrates trade balance calculations
c) It represents financial and capital movements
d) It shows the impact of government policies

User Aric Lasry
by
8.2k points

1 Answer

3 votes

Final answer:

In summary, the bottom portion of the figure shows the international flow of financial investments, different from the upper portion which illustrates the trade of goods and services.

Step-by-step explanation:

The question pertains to how the bottom portion of a figure, illustrating the international flow of investments and capital, differs from the upper portion which tracks the flow of exports and imports. Essentially, while the top portion focuses on the actual goods and services trade, with exports and imports along with the payments for these transactions taking center stage, the bottom portion is concerned with international financial investments and the associated financial flows. This includes the outflow and inflow of money due to investments like stocks and bonds, real estate transactions abroad, and international borrowing and lending.

To provide in summary after this explanation, the upper part of the figure captures the physical trade transactions in the economy, whereas the bottom part captures the capital and financial transactions, highlighting the movement of capital across borders as investments change hands and financial obligations are settled.

User Sanjoy Kanrar
by
8.1k points