The U.S.trade deficit is most likely to be harmful in the future if:
A)U.S.citizens continue to accumulate foreign assets.
B)U.S.production continues to exceed U.S.consumption.
C)the inflow of financial capital associated with it does not finance productive investment.
D)U.S.citizens refuse to lend to foreigners as a result of it.

Question

Quizplus · Accepted Answer

If the inflow of financial capital does not finance productive investment, it can lead to economic imbalances and a lack of growth, making the trade deficit harmful in the future.

The UStrade Deficit Is Most Likely to Be Harmful in the the Future