Experts,
reading 19, Q6, on Balance of Payments.
The answer says the international borrowing is financing private and public only, not consumption.
Also it says, current account deficit is funded by net international borrowing. I am confused with this.
My understanding is the total balance equation -4500 - 12265 - 3153 + OR = 0, so the toal borrowing is for all, because they are all deficits.
Why the anser says it is not funding consumption? Is n’t consumption same as net exports?
Thanks in advance.