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GCE Commerce 1990 Question 35

Question 35

Foreign Trade

Which of the following could account for a favourable balance of payment?

  1. A.High capital repayments
  2. B.high debt service repayment
  3. C.higher imports than exports
  4. D.Higher exports than imports
  5. E.Higher public spending
Show the answer and explanation

Answer: D (Higher exports than imports)

Explanation

When exports bring in more than imports cost, more money flows into the country, giving a surplus.