Complete the following table by indicating the effect each of the following transactions has on U.S. net capital outflow and whether it involves direct investment or portfolio investment. Transaction A Vanguard mutual fund sells its Toyota stock to a German investor. (Note: Assume the German investor pays in U.S. dollars.) Samsung sells stock to the General Electric pension fund. Sony expands its corporate office in New York. An American cellular phone company establishes an office in the Czech Republic. Effect on Net Capital Outflow Decrease ▼ Increase Decrease Increase Type of Investment Involved Portfolio investment ▼ Portfolio investment Direct investment Direct investment

Complete the following table by indicating the effect each of the following transactions has on U.S. net capital outflow and whether it involves direct investment or portfolio investment. Transaction A Vanguard mutual fund sells its Toyota stock to a German investor. (Note: Assume the German investor pays in U.S. dollars.) Samsung sells stock to the General Electric pension fund. Sony expands its corporate office in New York. An American cellular phone company establishes an office in the Czech Republic. Effect on Net Capital Outflow Decrease ▼ Increase Decrease Increase Type of Investment Involved Portfolio investment ▼ Portfolio investment Direct investment Direct investment

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter31: Open-Economy Macroeconomics: Basic Concepts

Section: Chapter Questions

Problem 4PA

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