The Trade Deficit Has Had the Effect Of

question 20

Multiple Choice

The trade deficit has had the effect of:

• A) Decreasing the Federal budget deficit
• B) Increasing economic growth in less developed nations
• C) Increasing direct foreign investment in the United States
• D) Decreasing protectionist pressure among U.S. businesses

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Definitions:

Marginal Cost

The cost added by producing one extra item of a product.

Purely Competitive

Another term for pure competition, it refers to a theoretical market structure with a large number of buyers and sellers, homogeneous products, and free entry and exit from the market.

Output Level

The total amount of goods or services produced by a business or economy within a specific period.

Economic Loss

A situation where total cost exceeds total revenue, resulting in a negative profit for a business.