Trade deficits always lead to future decreases in consumption if the trade deficits

Name: Trade deficits always lead to future decreases in consumption if the trade deficits
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Trade deficits that support current consumption without corresponding increases in investment or productive capacity can lead to future decreases in consumption. This is because resources are used for immediate consumption rather than being invested in ways that could increase future output or income.

Trade Deficits Always Lead to Future Decreases in Consumption If