Learn Before
Trade Surplus
A trade surplus occurs when the value of a country's exports exceeds the value of its imports. This situation corresponds to a positive trade balance, where the value of exports minus imports (X – M) is greater than zero.
0
1
Tags
Economics
Economy
Introduction to Macroeconomics Course
Ch.3 Aggregate demand and the multiplier model - The Economy 2.0 Macroeconomics @ CORE Econ
The Economy 2.0 Macroeconomics @ CORE Econ
CORE Econ
Social Science
Empirical Science
Science
Related
Exports
Trade Deficit
Trade Surplus
Example of Trade Imbalances: US and China (2010)
Real-World Determinants of Net Exports
Imports as a Function of Domestic Income
Net Export Function in the Multiplier Model
A consumer in Country A purchases a new car for $30,000 that was manufactured in Country B. Assuming this is the only economic activity, how does this transaction affect the calculation of Country A's Gross Domestic Product (GDP) based on expenditure?
Evaluating the Role of Imports in GDP Calculation
Correcting a Misconception about Imports and GDP
A country's Gross Domestic Product (GDP), calculated as the total spending on its domestically produced goods and services, will always decrease if the total value of goods its citizens purchase from other countries increases.
Analyzing International Trade's Role in Measuring Domestic Output
A country's economic activity for a year includes the following international transactions:
- Domestic firms sell $50 million worth of goods to foreign buyers.
- Domestic consumers purchase $30 million worth of goods produced in other countries.
- The domestic government purchases $10 million worth of equipment from foreign suppliers.
What is the net effect of these transactions on the calculation of this country's total expenditure on its own domestically produced goods and services?
Match each economic transaction for Country A with its correct impact on the components used to calculate Country A's total expenditure on its own domestically produced goods and services.
Analyzing a Flawed Argument about Imports
A country's economic data for a specific year reveals that total spending by its households on goods and services rose by $20 billion. Simultaneously, the total calculated value of all goods and services produced within the country's borders remained exactly the same as the previous year. Which of the following statements best explains this specific economic situation?
In a given year, the total spending by a country's households, businesses, and government amounts to $1,200 billion. Of this amount, $200 billion is spent on goods and services produced abroad. During the same year, the country sells $150 billion worth of its own goods and services to foreign buyers. Based on this information, the total value of all goods and services produced within the country's borders is $____ billion.
Learn After
In a given year, a country's total sales of goods and services to foreign nations amount to $450 billion, while its total purchases of goods and services from foreign nations amount to $375 billion. Which of the following accurately describes this country's international trade situation for that year?
Economic Consequences of International Trade Patterns
Analyzing Production and Consumption
Evaluating the Desirability of a Trade Surplus
A country reporting a positive value for its trade balance (total value of goods and services sold to other countries minus the total value of goods and services purchased from them) signifies that it is purchasing more from other countries than it is selling to them.
Match each international trade scenario with the correct term that describes it.
When the total monetary value of a nation's goods and services sold to other countries is greater than the total monetary value of goods and services it buys from other countries, the nation is said to have a ____.
Analyzing a Nation's International Trade Data
Deconstructing a Trade Surplus
A small island nation's economy records the following international transactions in a single year:
- Foreign tourists spend $200 million on hotels and services within the nation.
- It sells $150 million worth of coffee to other countries.
- Its citizens spend $50 million on vacations abroad.
- It purchases $120 million worth of foreign-made machinery.
- It buys $90 million in imported oil.
Based on these transactions, how would you characterize this nation's trade balance for the year?