International borrowing and lending may be interpreted as one form of
A) intertemporal trade.
B) intermediate trade.
C) trade in services.
D) unrequited international transfers.
E) aid to offset trade advantages.

Question

Quizplus · Accepted Answer

International borrowing and lending involve the exchange of present consumption for the promise of future repayment with interest, making it a form of intertemporal trade. It allows countries to smooth out consumption over time and to invest in projects that would not be feasible with domestic savings alone.

International Borrowing and Lending May Be Interpreted as One Form