Multiple choice

Which of the following had been responsible for the heavy burden of the deal and its interest?

  1. BOP surplus

  2. BOP deficit

  3. Equilibrium

  4. None of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The Balance of Payments (BOP) deficit creates a heavy debt burden because countries must borrow to cover the excess of imports/payments over exports/receipts. This debt accumulates with compound interest, creating long-term economic strain. A BOP surplus would not create such a burden.

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