Which statement do you agree with? (LO6) a) There are several problems causing our huge trade deficit; there are no easy solutions to these problems. b) We could quickly eliminate our trade deficit by raising tariffs. c) The main reason we have a large trade deficit is that foreigners refuse to buy American goods and services. d) The main reason for our large trade deficit is our relatively low rate of economic growth.

A trade deficit occurs when a country imports more goods and services than it exports. This means that there is a net outflow of money from the country and foreign goods are purchased more than domestic goods.

We will analyze each of the given statements to determine which one can be agreed upon: a) There are several problems causing our huge trade deficit; there are no easy solutions to these problems. This statement suggests that the issue of trade deficit is complex and requires a multi-faceted approach to solve it. b) We could quickly eliminate our trade deficit by raising tariffs. This statement proposes a potential solution, but raising tariffs may lead to other negative consequences, such as other countries raising their tariffs in retaliation, which could be harmful to the global economy. c) The main reason we have a large trade deficit is that foreigners refuse to buy American goods and services. This statement oversimplifies the problem, as it might not be only about foreigners' consumer preferences but other factors such as exchange rates, global economic conditions, and competitiveness. d) The main reason for our large trade deficit is our relatively low rate of economic growth. This statement assumes that a low rate of economic growth is the key factor influencing trade deficits, however there may be several other factors as well.

Considering the analyses in Step 2, statement (a) seems the most reasonable, as it acknowledges the complexity of the issue and accounts for multiple contributing factors. It also suggests that there is no easy, one-size-fits-all solution to the problem of trade deficits.