A Nation Has an Unfavorable Balance of Trade When

question 1

Multiple Choice

A nation has an unfavorable balance of trade when

• A)it has a surplus in its balance of payments
• B)it has a deficit in its balance of payments
• C)the value of its imports of goods is greater than the value of its exports of goods
• D)its current account is in surplus and its capital account is in deficit
• E)it has high tariffs

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Definitions:

Economies of Scale

The cost advantage achieved by an increase in production, leading to a decrease in the cost per unit.

Inbound Transportation Costs

Expenses associated with moving goods from suppliers to a company, including freight, shipping, and handling fees.

Milk Runs

A delivery method in which a single vehicle collects goods from several suppliers in a single trip, improving efficiency and reducing transportation costs.

Supplier

A business or individual that provides goods or services to another entity, playing a crucial role in the supply chain.