Those Who Say the Growing Current Account Deficit in the United

question 226

Multiple Choice

Those who say the growing current account deficit in the United States is not a significant problem make the argument that:

• A) the current account deficit is offset by an equally large capital account deficit,which ultimately leads to appreciation of the U.S.dollar.
• B) the large current account deficit will ultimately lead to a current account surplus.
• C) the current account deficit may hurt exporters,but American consumers gain as a result of lower relative prices.
• D) the increased investment in the United States as a result of the current account deficit will ultimately lead to increases in wealth and economic growth in the United States.