Answered>Order 1744

Those who say the growing current account deficit in the United States is not a significant problem make the argument that:

1.the current account deficit may hurt exporters, but American consumers gain as a result of lower relative prices.

2.the current account deficit is offset by an equally large capital account deficit, which ultimately leads to appreciation of the U.S. dollar.

3.the large current account deficit will ultimately lead to a current account surplus.

4.the increased investment in the United States as a result of the current account deficit will ultimately lead to increases in wealth and economic growth in the United States.