Answer to Question #318152 in Microeconomics for ada

Question

merchandise exports= 82.1, merchandise imports= 128.7, invisibles= 29.9, services= 18.7, transfers= 17.0, income[net]= -5.8, capital accounts= 4.8, errors= -0.3. calculate trade balance

Answer 1

Trade balance is the difference between the country's exports and imports.

therefore;

$BOP = X-M$

where $X$ - Exports

$M$ - Imports

$BOP = 82.1-128.7 = -46.6$

The BOP is negative and therefore there is a trade deficit.