Question

Which of the following statements about the financing of international trade is correct? A.International trade means...

Which of the following statements about the financing of international trade is correct?

A.International trade means the trading of financial assets for foreign exchange
B.Most international transactions are made with gold.
C.Imports are more important than exports to the economy of a nation.
D.Exports provide the foreign currencies needed to pay for imports.

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Answer #1

Option D

D. Exports provide the foreign currencies needed to pay for imports.

.International trade means the trading goods and services between two or more countries and it exchanged in different currencies and not gold. The imports need to be paid in the same currency or an international currency like dollar and that earned from export. It is like a family revenue is earned from export and expenses is down on import, so the trade balance is an income of the family, assuming a country as a family.

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