Question

If the u.s. imports $200 billion worth of goods and services from china and sells $500 billion worth of goods and services, then the u.s. is running a____

A. trade imbalance
B. trade balance
C. trade surplus
D. trade deficit

Answer 1

The U.S. is running a trade surplus since it exports more than it imports, with $500 billion in exports compared to $200 billion in imports.

Step-by-step explanation:

If the U.S. imports $200 billion worth of goods and services from China and sells $500 billion worth of goods and services, then the U.S. is running a trade surplus. This is because the value of exports ($500 billion) exceeds the value of imports ($200 billion), indicating that more goods and services are being sold to other countries than are being bought from them. A trade surplus contrasts with a trade deficit, which occurs when a country imports more than it exports.

Trade Surplus: Exports > Imports

Trade Deficit: Exports < Imports

Trade Balance: Exports = Imports

Based on the given scenario, the correct answer would be C. trade surplus.