Assume That a Country Currently Has a Trade Surplus

question 50

Multiple Choice

Assume that a country currently has a trade surplus.If that country experiences an expansion in economic activity,what would we expect to happen to the trade surplus?

• A) Nothing,because expansions do not impact the trade surplus.
• B) Imports tend to be higher during this time,which decreases the trade surplus.
• C) Exports tend to be lower during this time,which increases the trade surplus.
• D) Exports tend to be higher during this time,which decreases the trade surplus.
• E) Imports tend to be lower during this time,which increases the trade surplus.

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Definitions:

Accounts Receivable

Financial dues customers hold with a company for the provision of goods or services, awaiting recompense.

Accounts Payable

Money owed by a company to its suppliers or creditors for goods and services received but not yet paid for.

Cash Flow To Stockholders

The net amount of cash and cash-equivalents being transferred into and out of a company, specifically relating to the dividends paid to stockholders and the cash received from issuing new shares.

Dividends Per Share

The total amount of declared dividends for every share of common stock issued, divided by the number of outstanding shares.