The net-debtor status of the United States is reflected by the large deficits in its
A) service account.
B) investment income account.
C) unilateral transfers account.
D) current account.
E) merchandise account.

Question

Quizplus · Accepted Answer

The current account represents a country's net transactions with the rest of the world in goods, services, income, and unilateral transfers. A deficit in the current account means that the US is importing more than it is exporting and is using more foreign capital to finance domestic spending. This translates to a net-debtor status for the United States.

The Net-Debtor Status of the United States Is Reflected by the Large