Which of the Following Best Explains the Effect of Trade

question 23

Multiple Choice

Which of the following best explains the effect of trade policies on the trade balance?

• A)Trade policies alter the trade balance because they alter imports of the country that implemented them.
• B)Trade policies alter the trade balance because they alter net capital outflow of the country that implemented them.
• C)Trade policies do not alter the trade balance because they cannot alter the national saving or domestic investment of the country that implements them.
• D)Trade policies do not alter the trade balance because they cannot alter the real exchange rate of the currency of the country that implements them.

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Definitions:

Quantity

The property that describes the amount or number of material or immaterial things.

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In logic, propositions that cannot both be false but can both be true, used in the context of categorical logic.

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