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    Trade Deficit

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    I need help on just getting started with each question as to which angle to take and what resources to use.

    1. What has caused the U.S. run a merchandise trade deficit year after year since the early 1980s?

    2. Is the current account a deficit problem? Explain.

    3. Is the trend of the international investment position of the U.S. problematic? Why or why not?

    4. How is the current account related to a country's business cycle?

    5. What is the relationship between a country's net financial inflow and its current account?

    6. How does the U.S make adjustments for the balance of payment issues?

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    Solution Summary

    What has caused the U.S. run a merchandise trade deficit year after year since the early 1980s?

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