Borrowing from abroad represents A capital outflow A capital

Borrowing from abroad represents:

A capital outflow.

A capital inflow.

Positive net savings.

None of the above.

Solution

Borrowing from abroad represents - A Capital Inflow.

When host government borrowing from international banks or from other government to finance a balance of payments deficit ,or borrowing by individuals and companies from international banks and inter-company transfers to finance current consumption and investment.