Question

A large current account deficit is most likely to come about when desired investment​ _____ substantially and if desired national saving​ _____ substantially.

Answer 1

Answer:

Increases; Declines

Explanation:

A current account deficit occurs when the value of imports (of goods, services and investment income) is greater than the value of exports. If the currency is overvalued, imports will be cheaper, and therefore there will be a higher quantity of imports.