Question

What do you mean by trade deficit?

Answer 1

Explanation:

Trade balance, trade balance, or net exports is the difference between exports and imports of a nation's monetary value over a certain period of time. Sometimes there is a distinction between a trade balance for products and a trade balance for services.

A trade deficit is an economic indicator of international trade that exceeds the imports of a country's exports. A trade deficit is an outflow to foreign markets of domestic currency. It is also called a negative trade balance. Trade deficit is expressed as -

Trade deficit = total import value–total export value.

Answer 2

A trade deficit is an economic condition in which the amount of imports is exceedingly large than the amount of export from the country.

Explanation:

• Trade deficit is an economic condition in which import exceeds the export in the country. If any country is importing more products than it is exporting then it leads to the movement of domestic currency in world market and also foreign reserve currency of country is also significantly used in this process.
• Both of these are harmful to country in long run because it leads to negative balance of trade and country is said to be in condition of debt.
• This condition is called as a condition of trade deficit. It is calculated by subtracting total value of export from the total value of import, if result is negative then condition of trade deficit is said to have taken place.