Describe the tools used for measuring a nation's international ...

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Describe the tools used for measuring a nation's international trade. Use these tools to describe the United States' international trade experience over the past 30 years.

Question 2

A ____ is issued by the exporter's bank, ordering the importer's bank to pay for the merchandise.
 A) license
  B) letter of credit
  C) bill of lading
  D) draft
  E) voucher

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Answer to Question 1

A nation's balance of trade is a basic measure of the difference between a nation's exports and imports. When the total value of a nation's exports is higher than the total value of its imports, the country is experiencing a trade surplus. If the total value of imports is higher than the total value of exports, the country has a trade deficit. Balance of trade includes the value of both goods and services, and it incorporates trade with all foreign nations. A nation's balance of trade is only a portion of a nation's balance of payments. The balance of payments is a measure of the total flow of money into or out of a country and also includes other financial flows such as foreign aid payments and receipts, foreign borrowing and lending, and foreign investments. A balance of payments surplus means more money flows in than out, while a balance of payments deficit means that more money flows out than in.
Since 1976, the United States has experienced an overall trade deficit as the American consumers' appetite for foreign goods has grown. Although this trade deficit is predicted to narrow as demand falls in response to the global economic crisis, this deficit remains a challenge with regard to the long-term economic health of the United States economy.

Answer to Question 2

D

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