A trade deficit is balanced with a

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Quizplus · Accepted Answer

A trade deficit refers to a situation where a country imports more goods and services than it exports. This creates a negative balance of trade. However, this deficit can be balanced by a capital account surplus. A capital account surplus means that a country is receiving more capital inflows than outflows, thereby balancing the deficit created by a trade deficit. A trade surplus refers to a situation where a country exports more than it imports, and a capital account deficit refers to a situation where a country is experiencing more capital outflows than inflows, which would not balance a trade deficit. Therefore, the correct answer is B.

A Trade Deficit Is Balanced with a