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In order to correct adverse balance of payments... - WAEC Economics 2015 Question

In order to correct adverse balance of payments problem, government should? 

A
reduce tariffs
B
increase subsidies on exports
C
increase tax on local industries
D
reduce personal income tax
correct option: b

Methods of correcting adverse balance of payments

Well- known Methods of Correcting in Adverse Balance of Payment

  • Trade Policy Measures: Expanding, Exports and Restraining Imports
  • Expenditure-Reducing Policies
  • Tight Monetary Policy
  • Contractionary Fiscal Policy
  • Expenditure – Switching Policies: Devaluation
  • Devaluation: Marshall Lerner Condition
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