Question

In a recent year, the United States exported $26.5 billion in goods to France. It imported $34.0 billion in goods from France. In that year, the U.S. had a _____ with France.
a. $60.5 billion trade surplus
b. $60.5 billion trade deficit
c. $7.5 billion trade surplus
d. $7.5 billion trade deficit

Answer 1

To determine whether the U.S. had a trade surplus or deficit with France, we calculate the difference between exports and imports.

Exports to France: $26.5 billion
Imports from France: $34.0 billion

Now, we find the difference:

Trade balance = Exports - Imports
Trade balance = $26.5 billion - $34.0 billion
Trade balance = -$7.5 billion

Since the trade balance is negative, this indicates a trade deficit.

Therefore, the correct answer is:
d. $7.5 billion trade deficit