Question

which of the following is an accurate statement regarding trade deficits a. [in some cases trade deficits may cause the value of currency to fall forcing a nation to go into debt. b.] if a nation exports more than it imports it has a trade deficit. c. [trade deficits strengthen a nation balance of payment. d.] often times a trade deficit encourages nations to import more goods from other countries.

Answer 1

In some cases trade deficits may cause the value of currency to fall forcing a nation to go into debt and this statement is an accurate statement regarding trade deficit. the correct option among all the options that are given in the question is the first option. most countries with trade deficits have more imports and less exports.

Answer 2

Correct answer: a. in some cases, trade deficits may cause the value of currency to fall forcing a nation to go into debt.

In turn, the falling value of a nation's currency will often serve as a sign that the nation's economy is having problems.  Inc. magazine exchange rates (the value of one country's currency relative to other countries) "play a vital role in a country's level of trade, which is critical to most every free market economy."