Countries experiencing balance of payments surpluses are usually eager to inflate their economies

Law of Supply

What will be an ideal response?

Suppose a developing country is falling further behind the developed countries that it neighbors. As an economic consultant, you are called to look at its policies to recommend changes. If you saw all of the following on your visit, which of them could be an explanation for the slow growth in the economy?

A. You see that the roads, bridges, and ports are in terrible shape. B. You see that new companies require few licenses to move their exports. C. You see that the central bank does not pay attention to what the elected officials want. D. You see that literacy rates rival those of its developed neighbors.