Question

Which of the following best defines balance of trade?

a. The total flow of money into the country minus the total flow of money out of the country over some period of time.
b. The ability to specialize in the production of a specific product and trade it for other needed products.
c. Purchasing products in other countries and bringing them into one's own country.
d. The ability to produce a certain product more efficiently than any other nation.
e. The total value of a nation's exports minus the total value of its imports over some period of time.

Answer 1

The balance of trade (or trade balance) is the gap between a nation's dollar value of its exports and imports. It is the difference between the total value of a nation's exports and the total value of its imports over a specific period of time.

Step-by-step explanation:

The balance of trade (or trade balance) is the gap between a nation's dollar value of its exports and imports. It is the difference between the total value of a nation's exports and the total value of its imports over a specific period of time. If exports exceed imports, the economy has a trade surplus, while if imports exceed exports, the economy has a trade deficit.