An article in the Wall Street Journal stated, “The trade outlook in the U.S. has improved slightly overall this year. One big factor behind the smaller gap: Stronger growth in Asia and Europe.”
a. How would stronger growth in Asia and Europe lead to a smaller trade gap?
b. The article noted that there was a decline in imports early in the year and that “economic growth [in the United States] remained sluggish overall in the first three months of the year.” Is there a connection between a decline in imports and sluggish economic growth? Briefly explain.