6 Questions
What is the purpose of the balance of payments?
To summarize a country's exports and imports, investment activity, and flows of funds
What is the current account balance in the given example?
-30
What is a trade deficit similar to?
Borrowing
What determines whether a trade deficit is good or bad?
How we use the corresponding financial account surplus
What is excluded from the current account?
Longer-term real and financial investments
What is the potential benefit of a trade deficit if managed properly?
Expanding productive capacity
Understand the implications of trade deficits on the US economy and its people. Learn how the balance of payments, exports, imports, and investment income affect the country's economic well-being. Test your knowledge on the current account balance and its components.
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