Answer (D) is correct . The balance of trade is the difference between imports and exports of goods alone over a given period (the balance of payments is more comprehensive, embracing all transfers made between two countries, including capital movements). A country’s balance of trade is decreased (worsened) by imports.
Answer (A) is incorrect because Foreign investments in the United States is a factor in the balance of payments but not trade.
Answer (B) is incorrect because U.S. investments in foreign countries is a factor in the balance of payments but not trade.
Answer (C) is incorrect because Exports increase the balance of trade.
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