In 2007, France's exports totaled $490 billion and its imports totaled $529 billion. As a result, the
i. rest of the world supplies funds to France.
ii. quantity of loanable funds in France is less than the supply.
iii. Ricardo- Barro effect occurs in France.

Question

Quizplus · Accepted Answer

France had a trade deficit in 2007, meaning it imported more than it exported. This implies that the rest of the world supplied funds to France to finance this deficit.

In 2007, France's Exports Totaled $490 Billion and Its Imports