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# Current account urgent! Watch

1. Not sure about this question: Explain why the current account is often expressed as a percentage of GDP?
2. because when you want to compare the current account surplus or deficits of countries a country with a big gdp a deficit will be relatively alot smaller than if a county with a small gdp had the same deficit it would be more of a problem so if you measure it against GDP you have a measure of relative deficit or surplus. I hope this helps
3. (Original post by icyfox101)
because when you want to compare the current account surplus or deficits of countries a country with a big gdp a deficit will be relatively alot smaller than if a county with a small gdp had the same deficit it would be more of a problem so if you measure it against GDP you have a measure of relative deficit or surplus. I hope this helps
Surely if a country has a high GDP then they would be inclined to import more therefore leading to a current account deficit?
4. maybe depending on wether the country has a high propensity to consume imported goods but that is irrelevant to his question his question was why is the current account expressed as a percentage of GDP and the reason is so that when comparing economies you have an idea of the relative deficit or relative surplus of the current account because GDP is a good measure of the size of an economy for example if your adding up test marks 55 might be a good mark if the test is out of 60 but if the test is out of 120 then it is not so good so it would be better to compare a percentage to know how well you've done this is what this measure is trying to do.
5. (Original post by icyfox101)
maybe depending on wether the country has a high propensity to consume imported goods but that is irrelevant to his question his question was why is the current account expressed as a percentage of GDP and the reason is so that when comparing economies you have an idea of the relative deficit or relative surplus of the current account because GDP is a good measure of the size of an economy for example if your adding up test marks 55 might be a good mark if the test is out of 60 but if the test is out of 120 then it is not so good so it would be better to compare a percentage to know how well you've done this is what this measure is trying to do.
Thank you

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Updated: May 12, 2013
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