Final answer:
Money flows into the Mexican economy when foreign investors buy Mexican bonds or when Mexico receives foreign aid. Money flows out of the economy when Mexican companies invest abroad or repay loans to foreign banks.
Step-by-step explanation:
The financial flows in response to the activities mentioned involve either money entering or leaving the Mexican economy. Let's analyze each event:
- Purchase of Mexican government bonds by a foreign investor results in money flowing into the Mexican economy, as foreign capital is being invested in Mexican assets.
- A Mexican company investing in a foreign firm implies money flowing out of the Mexican economy since the investment is directed outside the country.
- Repayment of a loan by a Mexican firm to a foreign bank would mean that money is flowing out of the Mexican economy, as payment is being sent abroad.
- Foreign aid sent to Mexico would involve financial resources flowing into the Mexican economy as the country is receiving assistance from abroad.
To provide in summary, the purchase of bonds and foreign aid represents inflows, whereas Mexican investments abroad and loan repayments to foreign banks represent outflows of financial resources for the Mexican economy.