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Question
Explain the difference in types of balances of trade.
Answer in Brief
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Solution
The difference in types of balances of trade can be defined in 3 ways as mentioned below.
- When the value of imports is more than the value of exports, it is called ‘unfavorable balance of trade'.
- When the value of exports is more than the value of imports, it is called a ‘favourable balance of trade'.
- When the value of exports and imports is almost the same, it is called ‘balanced balance of trade’.
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