A Favourable Balance of Trade Occurs When

question 26

Multiple Choice

A favourable balance of trade occurs when:

• A)exports equal imports.
• B)the balance of payments balances.
• C)the current and capital account in the BOP are equal.
• D)the value of the exports of goods exceeds the value of the imports of goods.
• E)the value of the exports of goods is less than the value of the imports of goods .

---

Definitions:

Perfectly Competitive

A market structure characterized by a large number of small firms, identical products, and free entry and exit, leading to price-taking behavior.

Optimal Output Rule

The principle that profit is maximized by producing the quantity of output at which the marginal revenue of the last unit produced is equal to its marginal cost.

Marginal Revenue

The additional income earned by a company from selling one more unit of a good or service, reflecting the benefit of increased production.

Marginal Cost

The boost in expense for crafting one more unit of a product or service.