3. The external wealth of Country C changed from 1% of GDP to -0.5% of GDP...
3. The external wealth of Country C changed from 1% of GDP to
-0.5% of GDP in Year 1, and to
-1% of GDP in Year 2. Which statement below is consistent with this
pattern of change?
(a) Country C ran current account deficits in Years 1 and 2.
(b) Country C ran a current account deficit in Year 1 and a current
account surplus in Year 2.
(c) Country C ran a current account surplus in Year 1 and a current
account deficit in Year 2.
(d) Country C ran current account surpluses in Years 1 and 2.
Homework Answers
Ans-(d) Country C ran current account deficits in year 1&2
Current account balance= Trade balance+current transfers
If this balance is in deficit it reduces the GDP growth in coming year's.
Add Answer to:
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