Question

Is it better for your country to be an international

lender or borrower?

Short answer

To be a lender is better than a borrower generally.

Step-by-step solution

Step 1. Definition

When an economic transaction happens the person who gives money is the lender and the person who borrows or takes it is the borrower of the money.

Step 2. Explanation

It is comparably better to be a lender than a borrower. This is because, when a country is a lender, it will experience a trade surplus. When it lends its exports increases capital increases and employment increase as to complete the lending the country must have to employ the persons to produce the required output. The country will also receive interest on its lending amount. So that’s why a lender is in a better position.