Which of the following is a primary benefit for a nation that effectively exports its goods?

• A. It can increase its national income and promote economic growth.
• B. It guarantees a trade surplus in every year.
• C. It reduces the value of its currency relative to other nations.
• D. It will always eliminate the need to import any goods.

Answer: (A)

Verified step by step guidance

1. Understand the concept of exports: Exports are goods and services produced domestically and sold to foreign countries. When a nation exports effectively, it earns revenue from other countries.
2. Recognize the impact of exports on national income: The revenue from exports adds to the nation's total income, which can be used to invest in capital, infrastructure, and improve living standards.
3. Connect increased national income to economic growth: Higher income allows for more investment and consumption, which drives economic growth by expanding production capacity and employment.
4. Evaluate the incorrect options: A trade surplus is not guaranteed every year because imports and exports fluctuate; currency value changes depend on many factors beyond exports; and exporting does not eliminate the need to import goods, as countries often import goods they do not produce efficiently.
5. Conclude that the primary benefit of effective exports is the increase in national income and promotion of economic growth, as this directly reflects the positive economic impact of selling goods abroad.