current account deficit Flashcards
(3 cards)
1
Q
what is the current account deficit?
A
occurs when a country imports more goods, services, and capital than it exports. It means that the value of a country’s total imports of goods, services, income, and transfers is greater than the value of its exports (imports more valuable than exports)
2
Q
formula for current account deficit:
A
total imports - total exports
3
Q
what does the current account include?
A
-Trade balance (exports - imports of goods and services)
-Net income from abroad
-Net current transfers
