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If a Country Is Exporting More Goods and Services Than

Question 37

Multiple Choice

If a country is exporting more goods and services than it is importing, we should consider this to be "beneficial" only in the sense that it


A) increases the standard of living through a larger national income.
B) means that an economy is earning more than it is spending.
C) represents an accumulation of assets for the domestic economy that can be used in the future to finance consumption.
D) allows a country to add to its foreign- exchange reserves above the level needed to cope with fluctuations in private payments.
E) is a necessary condition to enable a country to take full advantage of scale economies.

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