Question

What is consistent with capital flight from mexico?

a. mexican net exports decrease.
b. mexican investment increases.
c. mexican savings increase.
d. mexican real interest rate decreases.

Answer 1

Factors consistent with capital flight from Mexico include a decrease in Mexican net exports, an increase in Mexican savings, and a decrease in the Mexican real interest rate.

Step-by-step explanation:

Capital flight refers to the movement of funds out of a country. In the case of Mexico, consistent factors with capital flight are:

1. Mexican net exports decrease: This means that the amount of goods and services that Mexico sells to other countries decreases, reducing its inflow of foreign currency.
2. Mexican savings increase: In times of capital flight, people tend to move their savings out of the country in order to protect their assets.
3. Mexican real interest rate decreases: A decrease in the real interest rate makes investing in Mexico less attractive, leading to outflows of foreign funds.