Answer in all option please How might a budget deficit affect the balance of trade?A budget deficit raises interest rates, which raises exchange rates and increases the balance of trade.A budget deficit raises interest rates, which raises exchange rates and reduces the balance of trade.A budget deficit reduces interest rates, which raises exchange rates and reduces the balance of trade.A budget deficit reduces interest rates, which reduces exchange rates and reduces the balance of trade.

Option b: This option is correctThe correct statement regarding how a budget deficit might affect…

Answered: How might a budget deficit affect the…

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter4: The Aggregate Economy

Section: Chapter Questions

Problem 5E

See similar textbooks

Similar questions

Assume that in 2010, a country had a GDP of $500$⁢500 billion, a budget deficit of $6$⁢6 billion, and a trade deficit of $10$⁢10 billion. In five years, the budget deficit became $4.0$⁢4.0 billion, and the trade deficit as a percentage of GDP changed by 0.70.7 percentage point(s). GDP remained unchanged.Calculate the dollar value of the trade deficit in 2015.
How could a greater budget deficit increase the trade deficit? What happens to the multiplier if there is an increase in the marginal propensity to consume? What would likely happen to the level of economic activity if the government took the necessary steps to reduce the deficit significantly in a relatively short period of time? When is the most appropriate time to reduce the deficit?
If a country has a trade deficit of $30 billion, which of the following can be true? Group of answer choices The country's exports are $150 billion and its imports are $120 billion. The country's exports are $110 billion and its imports are $140 billion. The country's exports are $140 billion and its imports are $40 billion. The country's exports are $120 billion and its imports are $140 billion.
A government decides to introduce an expenditure-switching measure to reduce a balance of trade deficit. Which of the following is an expenditure-switching measure? Pick a,b,c, or d A. A government subsidy to domestic producers B. An increase in income tax C. An increase in the rate of interest D.A decrease in state benefits
The United States typically has a balance-of-trade deficit in its trade with which two countries? North Korea Japan China Iran
Assuming that a country has a trade deficit of $50 billion, which of the following is true: A. The country's exports are $120 billion and its imports are $180 billion B. The country's exports are $100 billion and its exports are $150 billion c. The country's imports are $120 billion and its exports are $180 billion d. The country's exports are $150 billion and its imports are $100
When a country exports more goods and services than it imports, this is called Multiple Choice a balance of trade deficit. a balance of trade surplus. a positive terms of trade. a negative terms of trade.
In 2010, the economy of Minitown exported $1800 worth of goods and services and imported $1550 worth of goods and services. What was Minitown’s trade balance? Was Minitown running a trade surplus or deficit?
Catherin Mann (2006), “The Current Account and the Budget Deficit: A Disaggregated Perspective,” in Kopcke, Tootell, and Triest (eds.), The Macroeconomics of Fiscal Policy, MIT Press In the article, Mann notes that the foreign financing of the US current account deficit has increasingly taken the form of foreigners purchasing US Treasury bonds. She is concerned that the increase of foreign holdings of US Treasury bonds may worsen the US current account deficit in the future. Which of the following statements is inconsistent with her reasons behind the concern? a. As global interest rates starts to climb, the overall payments on interest-bearing liabilities (including US Treasury bonds) will rise. b. The interest paid on US government debt (ie, US Treasury bonds) will be increasingly paid to foreign holders, setting up a negative feedback loop between fiscal deficit and current account deficit. c. The greater the US current account deficit, the larger the risk of eventual, sharp…
What is the difference between a government deficit and a trade deficit ?
Suppose a Portuguese citizen travels to Tanzania to go on a safari and uses euros for the transaction. Tanzania then uses the euros to purchase wine from Portugal. How will this transaction affect Portugal's trade deficit? The first transaction is recorded as an export capital account an export deficit will increase in the . The second transaction is recorded as in the capital account so the trade
United States currently runs a significant trade deficit with the rest of the world. Research an academic journal article regarding some of our trade balances with specific countries and share what you find. For example, with whom do we run the largest deficits, with whom do we have surpluses, etc.? Do you think it is a problem if we run a trade deficit? Why or why not? In answering, keep in mind what impact a trade deficit has on other parts of our balance of payments.

SEE MORE QUESTIONS

Recommended textbooks for you

Economics:

Economics

ISBN:

9781285859460

Author:

BOYES, William

Publisher:

Cengage Learning

Economics:

Economics

ISBN:

9781285859460

Author:

BOYES, William

Publisher:

Cengage Learning

SEE MORE TEXTBOOKS