Which of the following statements defines trade balance?

Question

Quizplus · Accepted Answer

Trade balance is the difference between a country's exports of goods and services and its imports of goods and services. The statement that defines trade balance most accurately is Option B, where the trade balance is defined as the difference between merchandise exports and merchandise imports. Option A and Option E are incorrect since they add services balance, current account balance, and capital account balance to the trade balance, whereas the trade balance only covers goods and services. Option C is partially correct since it includes the current account balance, but it excludes the merchandise trade balance, which is a significant part of the trade balance. Option D defines net capital flow, which is different from trade balance.

Which of the Following Statements Defines Trade Balance