Statement 1. We have been running large balance of payments deficits in recent years. Statement 2 . The most widely used currency in the world is the euro. (LO2, 3) a) Statement 1 is true and statement 2 is false. b) Statement 2 is true and statement 1 is false. c) Both statements are true. d) Both statements are false.

Statement 1 says, "We have been running large balance of payments deficits in recent years." To determine whether this statement is true or false, we need to understand what balance of payments deficits is and examine any available data on the recent trend. Balance of payments is a record of a country's transactions with the rest of the world in a given period of time. A deficit indicates that the country is importing more goods and services, making more investments, and/or consuming more foreign resources than it is exporting, making less investment, and/or supplying to other countries. A balance of payments deficit could be true for a specific country, but since the statement does not clarify which country it refers to, we cannot give a definitive answer whether this statement is true or false.

Statement 2 says, "The most widely used currency in the world is the euro." To determine if this statement is true or false, we need to compare the euro's usage to other currencies on a global level. The term "widely used" can refer to various aspects, such as international trade, foreign exchange reserves, and global transactions. In recent years, the US dollar (USD) has been the dominant global currency, as evidenced by its wide use in international trade and as a foreign exchange reserve currency held by central banks worldwide. Although the euro (EUR) is the official currency of the majority of European Union countries and is also used in international trade, it is still not the most widely used currency globally.

Based on our analysis, we can deduce the following regarding the provided statements: - Statement 1: True or false (depending on which country it refers to) - but not definitive without further clarification. - Statement 2: False Comparing our analysis to the provided options: a) Statement 1 is true and statement 2 is false. b) Statement 2 is true and statement 1 is false. c) Both statements are true. d) Both statements are false. Considering our analyzes, the most accurate answer would be **(a) Statement 1 is true and statement 2 is false**. However, it is important to note that the first statement's truthfulness is contingent upon the country it refers to, and it would be better if it was clarified which country it is referring to in the question.