If the United States exports $250 billion worth of goods and imports $420 billion worth of goods

Question

Quizplus · Accepted Answer

The balance of trade is the difference between the value of a country's exports and imports of goods. In this case, the United States has a trade deficit of $170 billion ($420 billion - $250 billion), meaning it imports more goods than it exports. Therefore, option B is correct. The balance of payments includes not only trade in goods but also trade in services, income, and transfers, so option A is incorrect. Option C is incorrect because it assumes the balance of trade is positive, which is not the case. Option D refers to the official reserves account, which records a country's purchases and sales of foreign currency to support its exchange rate, and is not related to the balance of trade.

If the United States Exports $250 Billion Worth of Goods