The country of Nelly exports $250 of goods and services and imports $170 of goods and services.Nelly has an unfavorable balance of trade of $80.
An unfavorable balance of trade,or trade deficit,occurs when the value of imports exceeds that of exports.In this case,Nelly has a favorable balance of trade of $80.

Question

Quizplus · Accepted Answer

The statement is incorrect. An unfavorable balance of trade means that the value of imports exceeds that of exports, resulting in a trade deficit. Therefore, Nelly has a trade deficit of $80, not a trade surplus (favorable balance of trade) of $80.

The Country of Nelly Exports $250 of Goods and Services