ASSIGNMENT 5 Choose one of the following questions to answer 1. The United States has been consuming more than it has been producing for more than 30 years, making it the largest debtor nation in the world. Deuteronomy 28:43-44 warns against such indebtedness to foreigners. "Aliens residing among you shall ascend above you higher and higher, while you shall descend lower and lower. They shall lend to you but you shall not lend to them; they shall be the head and you shall be the tail." a) Is the trade deficit bad even if it can continue indefinitely? b) Are there biblical precepts against living beyond one's means that suggests any trade deficit is bad? c) In what way is the Deuteronomist's saying true for America today? 2. The U.S. trade deficit was about $480 billion, or 3 percent of GDP, in 2012. Some economists argue that this gap is truly frightening because the current account deficit is the amount of money the United States must attract from abroad. If foreign investors stop buying U.S.bonds and stocks, the skyrocketing interest rates, plummeting stock values, and an economic downturn will surely follow. Others see the gaping current account deficit as a sign of economic vitality. The flipside of a large trade deficit is, after all, a surplus of capital flowing into your country. a) Is the U.S. current account deficit a sign of impending disaster or a sign of economic health or something in between? b) How has this unprecedented shortfall affected the U.S. economy and how will it affect our economic future? 3. Look up the current U.S. trade balance. Would you suggest raising it or lowering it? Why