Suppose Grovner's exports equal $950 billion, its imports equal $1,000 billion, and Jpurchases of foreign assets by its citizens equals $900 billion. What is Grovner's balance on its current account?

Question

Quizplus · Accepted Answer

Current account balance = Exports - Imports - Purchases of foreign assets by citizens
= $950 billion - $1,000 billion - $900 billion
= -$50 billion
Since the balance is negative, it represents a current account deficit. The correct option is B, which represents a deficit of $50 billion.

Suppose Grovner's Exports Equal $950 Billion, Its Imports Equal $1,000