A current account surplus indicates that Canada is ________ its claims on foreign wealth, while a deficit indicates that this country is ________ its claims on foreign wealth.

Question

Quizplus · Accepted Answer

A current account surplus means that Canada is exporting more than it is importing, which leads to an increase in its claims on foreign wealth. Therefore, the correct answer is increasing. On the other hand, a current account deficit means that Canada is importing more than it is exporting, which implies a reduction in its claims on foreign wealth. Therefore, the correct answer is reducing.

A Current Account Surplus Indicates That Canada Is ________ Its