The nation of Dholabha is experiencing a widespread drop in its spending. Hence, it has been declared as a nation going through a phase of recession. The people of Dholabha are dealing with reduced levels of employment, which is adversely affecting the economic growth of the nation. In this scenario, when Dholabha begins to thrive again and the gross domestic product (GDP) of the nation increases, _____.
A) the nation will experience a withdrawal of foreign capital
B) the citizens will begin demanding more imports
C) the nation will develop a positive trade balance
D) the value of the nation's currency will depreciate

Question

Quizplus · Accepted Answer

When a nation's economy begins to thrive and its GDP increases, its citizens generally have higher incomes and can afford to buy more goods and services, including those from abroad. This increased demand for imports is a common consequence of economic growth.

The Nation of Dholabha Is Experiencing a Widespread Drop in Its