Question

If imports are greater than exports, which of the following is true?

O Trade balance is positive resulting in a deficit
O Trade balance is negative resulting in a deficit
O Trade balance is positive resulting in a surplus
O Trade balance is negative resulting in a surplus

Answer 1

Trade balance is negative resulting in a deficit

Step-by-step explanation:

The difference between a country's value of imports and exports is known as the balance of trade. When imports of a country surpass the exports in a particular period, it is said to have a trade deficit. The balance of trade is negative should a country be a net importer.

A trade surplus is when a country is a net exporter. Should the value of a country's exports exceed the imports, the balance of trade is positive, and the country is said to have a trade surplus.