Whether the trade balance is positive (surplus) or negative (deficit) is important because it provides a measure of the financing needs of a particular country. Hence, the trade balance is more important than the current account balance. True or false?

Question

Yates

Business

10 June, 09:36

Whether the trade balance is positive (surplus) or negative (deficit) is important because it provides a measure of the financing needs of a particular country. Hence, the trade balance is more important than the current account balance. True or false?

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Stephen Hamilton · Answer 1

Answer:False

Explanation:The trade balance is not more important than current account balance. They are different concepts.

The balance of trade is a tool use to measure the relative strength of a country's economy by economist.

The balance of trade can measured by the examination of the difference between the value of a country's imports and the country'# exports for a given period. The balance of trade is happens to be the largest fraction in component of a country's balance of payments.