Question

All of the following are conducive to economic growth except

A. a reliable banking system
B. an unfavorable balance of trade and payments
C. a strong stock market and a government that discourages corruption
D. government policies that encourage investment and competition

Answer 1

Answer:

B. an unfavorable balance of trade and payments

Explanation:

• The BOP or the balance of trade is defined as the net gains or net exports that make the balance of payments and is said to be favorable when the country export more and imports less and is a positive change.

• It is said to be negative when the country imports more and exports less thus unfavorable in terms of the trade and payments.

• Hence it means that the country has a deficit and this can impact the services and is not good for the economic growth perspective.