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A Current Account Deficit Is a Problem If It Is

question 44

True/False

A current account deficit is a problem if it is only used to fund new investment, not consumption.


Definitions:

New Potatoes

Young potatoes that have been harvested early in the season, known for their thin skins and tender texture.

Demand Curve

A graphical representation that shows the relationship between the price of a good and the quantity of that good that consumers are willing to purchase.

Thin-Crust Pizza

A type of pizza characterized by its slim, crisp base, offering a crunchy texture and contrasting with thicker pizza variants.

Normal Goods

Goods for which demand increases as the income of consumers increases, assuming all other factors remain constant.

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