Asked by Jesse Shiber on May 01, 2024
Verified
Statement I: Our oil imports and our trade deficit with Japan and China together account for the majority of our overall trade deficit.
Statement II: Although the Chinese market is open to American producers,the Chinese people have very little income to purchase relatively expensive imported goods.
A) Statement I is true and statement II is false.
B) Statement II is true and statement I is false.
C) Both statements are true.
D) Both statements are false.
Oil Imports
The purchasing of crude oil and petroleum products from foreign countries to meet domestic consumption and energy requirements.
Trade Deficit
A condition in which a nation buys more from foreign countries than it sells to them, leading to a deficit in the trade balance.
China
A country in East Asia, the world's most populous nation, with a significant impact on global economy and geopolitics.
- Examine the economical effects stemming from trade deficits and surpluses.
Verified Answer
FA
Fattima AlyasseriMay 07, 2024
Final Answer :
C
Explanation :
Both statements highlight significant aspects of the U.S. trade deficit and the dynamics of trade with China. Statement I points out the substantial impact of oil imports and trade with Japan and China on the U.S. trade deficit. Statement II addresses the issue of market access versus purchasing power in China, indicating that despite market openness, the purchasing power for expensive imports is limited.
Learning Objectives
- Examine the economical effects stemming from trade deficits and surpluses.