What does the term "twin deficits" commonly describe?

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A nation's simultaneous trade deficit and government budget shortfallThe situation where a country's trade deficit causes its trading partners to also experience deficitsThe balance between a country's saving shortfall and investment shortfallThe combination of a country's trade deficit and negative net capital outflows

Explanation

The phrase "twin deficits" specifically refers to when a country experiences both a trade deficit and a government budget deficit at the same time. Other options describe different economic concepts but do not capture the meaning of twin deficits.