Question

Measuring Global Trade

Most nations cannot produce all the products its people want and need. Even if a country did become self-sufficient, other nations would seek to trade with it to meet the needs of their own people. Examine the chart containing trade figures from various countries and determine the balance of trade.

Global trade enables a nation to produce what it is most capable of producing and buy what it needs from others in a mutually beneficial exchange relationship. This happens through the process called free trade. Through free trade, nations are able to import the goods and services they need and export the goods and services other nations need. In measuring global trade, nations rely on two key indicators: balance of trade and balance of payments. The balance of trade is the total value of a nation's exports compared to its imports measured over a particular period. A favorable balance of trade, or trade surplus, occurs when the value of a country's exports exceeds that of its imports. An unfavorable balance of trade, or trade deficit, occurs when the value of a country's exports is less than its imports.


Read the case below and answer the questions that follow.


For many years, the United States exported more goods and services than it imported. However, since 1975 it has bought more goods from other nations than it has sold and thus has a trade deficit. Recently, it ran its highest trade deficits with China. The chart below indicates the amount of goods and services the United States imports and exports from ten different countries.

U.S. Trade Balance, by Partner Countiy 2008 in descending order of trade turnover Imports for Consumption Domestic Exports Partner countıy million dollars---- $334,839.6 $337,504.2 $216,328.4 $139,112.3 $95,827.9 $58,418.6 $21,102.5 $17,378.5 $15,718.5 $17,715.9 $222,424.4 $67,165.9 $131,507.4 $61,435.2 50,150.5 $49,061.3 $37,076.2 $25,768.7 $25,655.5 $20,244.5 Canada na Mexico Japan German United Kingdom Netherlands Belgium Singapore Switzerland Source: United States International Trade Commission, 2008, dataweb. usitc gov

Which of the following statements is true?

Multiple Choice

The US exports the most goods to Canada.

The US imports the least goods from Switzerland.

The US exports the most goods to China.

The US imports the most goods from Canada.

The US exports the least goods to Singapore.

Answer 1

The correct option is The US exports the most goods to Canada, with a amount of 222,424.4 million dollars

The most goods are imported from China with a amount of 337,504.2 million dollars

Option 1 is correct