If net foreign investment in the United States is negative, how ...

[karlynnae]

If net foreign investment in the United States is negative, how must national saving and domestic investment be related?
 
  A) Domestic investment can be greater than or less than national saving.
  B) Domestic investment and national saving must also be negative.
  C) Domestic investment must be less than national saving.
  D) Domestic investment must be greater than national saving.

Question 2

Explain how the price system eliminates a surplus.
 
  What will be an ideal response?

[Cnarkel]

Answer to Question 1

D

Answer to Question 2

A surplus means that quantity demanded is less than quantity supplied. This will lead to downward pressure on price. As price falls, quantity demanded rises and quantity supplied falls. This will continue until quantity demanded is equal to quantity supplied.

[karlynnae]

Thank you

[Cnarkel]

No problemo