A Trade Surplus Could Be Balanced by All of the Following

question 42

Multiple Choice

A trade surplus could be balanced by all of the following except

• A)borrowing from domestic citizens.
• B)selling domestic assets to foreigners.
• C)borrowing from foreigners.
• D)selling foreign assets already owned by U.S.citizens to foreigners.

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Definitions:

Gold

A precious metal that is used as an investment, a store of value, and in jewelry, due to its scarcity, durability, and aesthetic appeal.

Credit Default Swap

A financial derivative allowing an investor to "swap" or offset their credit risk with that of another party.

Financial Risk

Financial risk encompasses the possible loss of financial assets, liabilities, or financial failure due to variables like currency fluctuations, interest rate changes, and funding challenges.

Capital Structure

The mix of debt and equity maintained by a firm.