Answer to Question #89481 in Macroeconomics for Sofia Bale

Question

Can a nation fund its investment at a level higher than that currently provided by its income? Explain

Answer 1

Yes, a country can finance its investments at a higher level. funding can be both internal and external. External finance - investments from foreign countries. To attract foreign investors, the country must be investment attractive. This means political and social stability, stability of economic growth, higher return on investment compared to other countries, low country risk, clearly defined property rights, legislation corresponding to world standards, low inflation, low crime rates and much more.

In order to raise the level of domestic investment, the state should encourage the population to save and invest by applying special tax incentives, invest in education, encourage research and development