Eco essay#1

Eco essay#1 - utilities such electricity and goods....

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Patricia Ade Eco 2023 02/03/08 Essay #1 Many people think that if a country has account an account deficit then it should not be able to compete in the international market. Some people believe that if an economy has a surplus that means that the economy is strong, but they fail to realize is that’s it a deficit that makes the economy strong. Deficit in account shows that the country’s economy is at debt, but it also shows that country is investing more than saving. It also shows that the country is using resources from other economies. A surplus on the economy shows that the country has been saving as service opposed to investing. With a surplus in an economy it shows the country is lending money and is being owed. The factors of the current account are goods, services, income and current transfers. Goods are merchandise or possessions that people buy. Income is what people receive on a regular basis, for work or through investments. Service is a system supplying a public need such as transport, communications, or
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Unformatted text preview: utilities such electricity and goods. Together goods, services and income provide the essential of what economy needs to function Current transfers are given with nothing to receive after such as workers remittances, donations, aids, and grants. A current account deficit is usually regarded like the account is exhausted because the reserves would be all into their investments. The deficit could also signify increase foreign investment in the local market, in which case the local economy investment income in the future stated Reem Heakal in the article Understanding the Current Account in the Balance of Payments . It may seem odd that an account deficit benefits ones economy, but its true. It makes the economy seem that they are well equipped for whatever fall that may come against them Reference Heakal, Reem. Understanding the Current Account in he Balance of payments . Investopedia.com. htpp://www.investopedia.com/articles/03/061803.asp...
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This note was uploaded on 04/15/2008 for the course ECO 2023 taught by Professor Sabet during the Spring '08 term at FIU.

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Eco essay#1 - utilities such electricity and goods....

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