During the period in which a nation has a current account surplus, it is a net ____, and whenever it has a current account deficit, it is a net ____.

Question

Quizplus · Accepted Answer

A current account surplus means that a country is exporting more goods and services than it is importing, resulting in a net inflow of money. This can be seen as a form of lending to other countries, as they are essentially buying more from the country than the country is buying from them. On the other hand, a current account deficit means that a country is importing more than it is exporting, resulting in a net outflow of money. This can be seen as a form of borrowing, as the country needs to finance its deficit by borrowing from other countries or using its own foreign exchange reserves. Therefore, the best choice is B: lender; borrower.

During the Period in Which a Nation Has a Current