In spite of having about 45% of the world's known oil reserves, Saudi Arabia and other Middle Eastern countries post current-account deficits, largely because:
A)of poor accounting practices.
B)of vast economic diversification.
C)they must import most of the goods and services.
D)most of the oil is exported.
E)new businesses are being developed.

Question

Quizplus · Accepted Answer

Saudi Arabia and other Middle Eastern countries post current-account deficits because they must import most of the goods and services they need. Despite having a large reserve of oil, the countries still need to import goods that are not produced domestically. This creates a deficit in their current account. Poor accounting practices, economic diversification, and new businesses being developed may all have an impact on their economy but are not the primary reasons for the current-account deficits.

In Spite of Having About 45% of the World's Known