Trade balance
Definition. The trade balance is the difference between the value of a country exports and the value of its imports of goods and services over a period. A trade surplus occurs when exports exceed imports, while a trade deficit occurs when imports exceed exports.
The trade balance forms the core of the current account of the balance of payments. It is influenced by exchange rates, relative prices and incomes at home and abroad, and the competitiveness of domestic producers.
This term belongs to The Balance of Payments in A Level Economics. Read the full chapter for the diagrams, worked examples and exam technique.
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