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Why Is It Not a Good Idea for a Developing

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Why is it not a good idea for a developing country to avoid having a trade deficit?


Definitions:

Output

The quantity of goods or services produced in a given time period by a firm, industry, or country.

Contraction

A period during which the economy declines as reflected by falling output, employment, income, and other aggregate measures.

Expansion

A period during which the economy grows as reflected by rising output, employment, income, and other aggregate measures

Long-term Growth

The sustained increase in the economic output of a country or region over a significant period.

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