CAT 2000 | Question: 146

Question

Answer the following question based on the information given below.
FEI for a country in a year, is the ratio (expressed as a percentage) of its foreign equity inflows to its GDP. The following figure displays the FEIs for select Asian countries for the years $1997$ and $1998$. 

The country with the largest change in FEI in $1998$ relative to its FEI in $1997$, is

• A. India 
• B. China 
• C. Malaysia 
• D. Thailand

Answer 1

Answer:  A (India)

 For India the value = (1.71-0.72)/1.71 = 57.894%...

Answer 2

Compute the change in FEI for each country:
Change=FEI (1998)−FEI (1997)

• India: (0.72 - 1.71 = -0.99)
• China: (4.8 - 5.96 = -1.16)
• Malaysia: (9.92 - 10.67 = -0.75)
• South Korea: (2.5 - 2.16 = +0.34)
• Thailand: (5.82 - 5.09 = +0.73)

Now take absolute values (since “largest change” includes both increase and decrease):

• India: 0.99
• China: 1.16
• Malaysia: 0.75
• South Korea: 0.34
• Thailand: 0.73

China has the largest change in FEI.

Answer: B. China