A current account deﬁcit will reduce U.S. foreign indebtedness.

Name: A current account deﬁcit will reduce U.S. foreign indebtedness.
Brand: Quizplus
Rating: 4.9 (43 reviews)

Question

Quizplus · Accepted Answer

A current account deficit means that a country is importing more than it is exporting, which ultimately means it is spending more than it is earning from foreign trade. This requires a country to borrow from foreign sources to finance the deficit, which increases foreign indebtedness rather than reducing it.

A Current Account Deﬁcit Will Reduce U.S. Foreign Indebtedness