When a country imports more than it exports, it has a(n)
A) trade surplus.
B) favourable balance of trade.
C) favourable exchange role.
D) unfavourable balance of trade.
E) favourable balance of payments.

Question

Quizplus · Accepted Answer

When a country imports more than it exports, it has an unfavorable balance of trade. This means that the country is spending more on imports (goods and services bought from abroad) than it is earning from exports (goods and services sold to other countries). This can lead to a deficit in the country's current account, which is part of the overall balance of payments. A deficit in the current account means that the country is borrowing from other nations to finance its imports, which can lead to a buildup of debt over time.

When a Country Imports More Than It Exports, It Has