Explain why a country can have a large trade deficit combined with a current account surplus. In explaining this, provide at least three transactions in the current account besides imports and exports. Explain how current transactions listed in this year’s capital account have implications for transactions in the current account in future years. Provide at least three examples. Suppose that a country has a current account deficit. Explain the three ways in which that deficit can be offset.

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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Explain why a country can have a large trade deficit combined with a current account surplus. In explaining this, provide at least three transactions in the current account besides imports and exports.

Explain how current transactions listed in this year’s capital account have implications for transactions in the current account in future years. Provide at least three examples.

Suppose that a country has a current account deficit. Explain the three ways in which that deficit can be offset.

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