The trade deficit has had the effect of

Question

Quizplus · Accepted Answer

The trade deficit has the effect of increasing direct foreign investment in the United States. This is because when the United States imports more goods and services than it exports, it must borrow money from other countries to pay for the difference. This borrowing takes the form of direct foreign investment, which is when foreign investors purchase assets in the United States, such as stocks, bonds, and real estate.

The Trade Deficit Has Had the Effect of