Assume That a Country Currently Has a Trade Deficit

question 125

Multiple Choice

Assume that a country currently has a trade deficit.If that country experiences a recession,what would we expect to happen to the trade deficit?

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