Question

What happens within the economy of a country when imports are greater than exports? a) Imports > Exports = Trade Deficit b) Imports > Exports = More American Jobs c) Imports > Exports = More Profit​

Answer 1

Answer: a) Imports > Exports = Trade Deficit

Explanation:

When something is said to be in deficit, it means that more money is being spent than is being received. This is why this situation is called a trade deficit, because imports represent spending and exports represent gains and when there is more spending than gains, there is a trade deficit.

When however, there is more exports than imports, you have what is called a trade surplus. Not a lot of countries can manage this.