When a country has a current account balance surplus,the country
A) always has a large government budget deficit.
B) is always lending abroad.
C) is always borrowing from abroad.
D) always has a large government budget surplus.
E) is always borrowing from domestic residents.

Question

Quizplus · Accepted Answer

A current account balance surplus means that a country's exports exceed its imports. In this case, the country is earning more from international trade than it is spending, which allows it to lend the excess funds to other countries. Therefore, choice B is the correct answer. Choices A, C, D, and E are incorrect because they do not necessarily follow from a current account balance surplus.

When a Country Has a Current Account Balance Surplus,the Country