If the Credit Risk of a Foreign Borrower Is Good

question 41

True/False

If the credit risk of a foreign borrower is good, then the sovereign country risk is irrelevant.

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Definitions:

Balance of Trade Deficit

A situation where the value of a country's imports exceeds the value of its exports, resulting in a net outflow of domestic currency to foreign markets.

Balance of Payments Surplus

A situation where the total of a country's exports and incoming funds from other countries exceeds its imports and outgoing funds.

Imports

Goods and services purchased from other countries.

Exports

Goods or services sent from one country to another for sale or trade.