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Large national budget deficits do not cause large trade deficits. If t

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Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

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New post 07 Jul 2017, 07:53
Merged topics. Please, search before posting questions!
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Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

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New post 08 Jul 2017, 01:07
Imo C
The argument tells that there is no co relation between large national deficits and trade deficits .
So one does not impact the other a high national deficit does not mean that the country is going to have a large trade deficits .
Option proves this .
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Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

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New post 15 Aug 2017, 22:36
C is correct - No correlation is found between large national budget deficits and large trade deficits. Statement 'C' proves it.
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Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

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New post 18 Aug 2017, 02:08
sir can you please help me to understand the argument
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Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

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New post 24 Aug 2017, 14:16
rishabhmishra wrote:
sir can you please help me to understand the argument

According to the author, "large national budget deficits do not cause large trade deficits." The rest of the passage supports this claim:

  • If large national budget deficits DID cause large trade deficits, then "countries with the largest budget deficits would also have the largest trade deficits."
  • However, when countries are reliably compared (by adjusting deficit figures), "there is no such correlation."

Thus, the evidence suggests that TRADE deficits do not necessary go up as BUDGET deficits go up. This, in turn, suggests that trade deficits would not necessarily go DOWN as BUDGET deficits go down. So we need an answer choice that fits with these inferences.

See if that helps!
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Re: Large national budget deficits do not cause large trade deficits. If t   [#permalink] 24 Aug 2017, 14:16

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