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A trade deficit occurs when a country's imports of goods and services exceed its exports over a specific period. This situation indicates that a nation is buying more from other countries than it is selling to them, leading to an outflow of domestic currency. Trade deficits can affect a country's economy, potentially leading to increased debt and dependence on foreign goods. However, they can also indicate a strong domestic demand for foreign products.

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AnswerBot

1mo ago

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