Foreign saving is used for domestic investment when foreigners engage in
a. foreign direct investment.
b. foreign portfolio investment.
c. either foreign direct investment or foreign portfolio investment.
d. none of the above is correct.

Foreign saving is used for domestic investment when foreigners engage in either foreign direct investment or foreign portfolio investment.

 

To add, ‘Foreign savings’ and the ‘net external resources inflows’ are the two popular acronyms used for the current account deficit in the balance of payments.

The federal reserve took an expansionary approach during the crisis. this was done by expanding the money supply and boosting liquidity. this can be seen in the fed's actions of lending to banks, purchasing securities, and lowering the federal funds rate in order to lower overall interest rates. the fed's goal was to increase consumer spending and overall liquidity within the system, and they pursued this by expanding the supply of liquid money.