If a Country Runs a Deficit in Its Current Account

question 62

Multiple Choice

If a country runs a deficit in its current account, it is because

• A)exports exceed imports
• B)imports exceed exports
• C)net unilateral transfers are negative
• D)foreign currency received from exports and transfers exceeds the foreign exchange needed to pay for
• Imports and to make unilateral transfers
• E)foreign currency received from exports and transfers is less than the foreign exchange needed to pay for
• Imports and to make unilateral transfers

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Definitions:

Unregulated Monopolist

An unregulated monopolist refers to a monopoly that operates without government intervention, setting prices and output levels without regulatory constraints.

Nondiscriminating

A principle or policy of treating all people equally, without unfair bias or discrimination.

Maximum Profits

The highest attainable profit a firm can achieve when it sets its production output at a level where marginal cost equals marginal revenue.

Perfectly Price-Discriminated

A market scenario where a seller charges each buyer their maximum willingness to pay, capturing all available consumer surplus as profit.