Exports of Goods and ServicesCurrent Account BalanceUnited States14%3.1%Japan15%2.0%Germany50%6.2%United Kingdom32%1.3%Canada30%3.0%Sweden50%7.0%Korea56%2.3%Mexico32%0.8%Brazil12%2.1%China31%1.9%India24%3.2%Nigeria40%3.6%World0.0%

Table 1.1 above shows the U.S. trade picture in 2013 compared with some other economies from around the world. While the U.S. economy has consistently run trade deficits in recent years, Japan and many European nations, among them France and Germany, have consistently run trade surpluses. Some of the other countries listed include Brazil, the largest economy in Latin America; Nigeria, the largest economy in Africa; and China, India, and Korea. The first column offers one measure of the globalization of an economy: exports of goods and services as a percentage of GDP. The second column shows the trade balance. Most of the time, most countries have trade surpluses or deficits that are less than 5% of GDP. As you can see, the U.S. current account is negative 3.1%, while Germanys is positive 6.2%.

QUESTION:

After completing the Learning Activity titled Trade Surplus Versus Trade Deficit, refer back to Table 1.1. From the table, select one country with a trade surplus and one country with a trade deficit, then answer the following questions: Why does this country have a trade deficit/surplus? What is this countrys greatest export? What is its greatest import? Compare the GDP of both countries, and lastly, explain what economic changes you would propose to fix the trade deficit.