Why does it matter that the $20m deficit is financed by direct investment rather than short-term borrowing?

Q: How do I try a free CXC CAPE Economics question?

Just tap any of the four options on this page — no signup, no card, nothing to install. You'll see the correct answer and a full mark-scheme-style explanation within a second. Each visit shows a fresh randomly-picked question from the live CXC CAPE CSEC Economics bank, so you can keep refreshing to try different ones before deciding whether to create a free account for daily access.

Q: Is Kramizo really free for CXC CAPE Economics students?

Yes — completely free. Every student gets 45 questions a day on the free plan, across any board and any subject, with no card required and no trial countdown. Kramizo's optional Pro plan removes the daily cap and adds analytics, but the free plan is genuinely free forever. We make money from the small percentage of students who choose to upgrade — not from selling data or ads.

Q: Are the Economics questions aligned to the CXC CAPE CSEC syllabus?

Every question is written against the published CXC CAPE CSEC Economics syllabus and reviewed for accuracy before being added to the bank. We match the command words (state, describe, explain, evaluate), mark allocations, and difficulty tier you'll see on real CXC CAPE past papers. Explanations are written in the style of official examiner mark schemes so students learn exactly what marks are being awarded for.

Question

Why does it matter that the $20m deficit is financed by direct investment rather than short-term borrowing?

Accepted Answer

Direct investment builds productive capacity that may raise future export earnings, while borrowing must be repaid — Award 1 mark. The composition of the financing says more about sustainability than the size of the deficit does.

Answer

Direct investment is recorded in the current account and borrowing is not

Answer

Direct investment does not need to be recorded at all

Answer

Direct investment builds productive capacity that may raise future export earnings, while borrowing must be repaid

Answer

Borrowing is prohibited under balance of payments rules

One real Economics question.No signup. 30 seconds.

One real Economics question.
No signup. 30 seconds.