Question

Mexico and Brazil, ran large trade deficits and borrowed heavily from abroad in the 1970s, but the inflow of financial capital did not boost productivity sufficiently, which meant that Select the correct answer below: the inflow of capital was beneficial to their economies these countries faced enormous troubles repaying the money borrowed these countries were prudent with their spending on imports none of the above

Answer 1

these countries were prudent with their spending on imports

Step-by-step explanation:

The trade deficit arise when the exports value would be lower than the imports value. Here the countries have to borrow so that they are able to pay back the amount so that the economy could be run in the smooth manner

The money that is borrowed from the rest of the world could increase the production so that the imports value could be increased

So according to the given situation, these countries would be prudent with their imports spending