GK
BUSINESS MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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when a country is spending more on foreign trade than it is earning
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amount charged by a lender to a borrower for the use of their money
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rate at which the level of prices for goods and services are rising and purchasing is falling
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exchange of one currency for another; conversion of one currency into another
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investor purchases large part of a company; has direct control of company
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Detailed explanation-1: -A trade deficit occurs when a country’s imports exceed its exports during a given time period. It is also referred to as a negative balance of trade (BOT).
Detailed explanation-2: -A trade deficit occurs when a nation imports more than it exports.
Detailed explanation-3: -A higher trade deficit leads to jobs being outsourced to foreign countries as more imports lead to fewer job opportunities. Demand for imported goods leads to a decline in demand for locally made goods, which leads to the closing of factories and the associated job losses.
Detailed explanation-4: -And a growing economy attracts more foreign investment. However, a trade deficit, in the long run, may not be beneficial. And that’s where a healthy balance of imports and exports is required. When imports increase beyond a certain extent, prices of goods and services reduce due to high competition.
Detailed explanation-5: -Trade deficit is an economic measure of international trade in which a country’s imports exceed its exports. Fiscal Deficit is the difference between total revenue and total expenditure of the government of a Country.