The term hot money in the context of foreign investment refers to
- A.foreign direct investment in manufacturing
- B.short-term portfolio flows that can leave quickly
- C.currency printed to meet a fiscal deficit
- D.remittances sent home by migrant workers
Show answer
Hot money is the name given to short-term portfolio capital that chases returns from one market to another and can be withdrawn within days, pushing up share prices and the rupee while it comes in and pulling both down when it goes.
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