If a Country Is Running a Trade Deficit This Year

question 43

Multiple Choice

If a country is running a trade deficit this year, it must pay for these goods by:

• A) selling financial assets.
• B) running a trade surplus in the future.
• C) selling government debt to foreign institutions.
• D) All of these answers are correct.
• E) None of these answers is correct.

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Definitions:

Planned Selling Price Sep## Actual Units Sold

This represents the comparison between the pre-established price at which goods were intended to be sold and the actual number of units sold.

Significant Variances

Major discrepancies between planned and actual figures in budgets, costing, or any financial metric.

Favorable Cost Variance

A situation where the actual cost of a product or service is less than its budgeted or standard cost.

Direct Materials Price Variance

The difference between the actual cost of direct materials used and the budgeted cost, based on the standard prices.