In a Small Open Economy, If Exports Equal $5 Billion

question 62

Multiple Choice

In a small open economy, if exports equal $5 billion and imports equal $7 billion, then there is a trade ______ and ______ net capital outflow.

• A) deficit; negative
• B) surplus; negative
• C) deficit; positive
• D) surplus; positive

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Definitions:

Significance Level

The probability of rejecting the null hypothesis in a statistical test when it is actually true, used as a threshold for determining the statistical significance of a result.

Sample Mean

The average value of a sample set of numbers, calculated by summing all observations and dividing by the number of observations.

Standard Deviation

A metric that quantifies the range of diversity or distribution of a series of values.

P-value

The probability of test results being at least as extreme as the observed outcomes, under the belief that the null hypothesis is factual.