BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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transactions in the flow of capital
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transactions relating to receipts and payment of invisible
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transactions relating only to exports and imports
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All of the above
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Detailed explanation-1: -The balance of payments (BOP) is the method by which countries measure all of the international monetary transactions within a certain period. The BOP consists of three main accounts: the current account, the capital account, and the financial account.
Detailed explanation-2: -The balance of payments summarises the economic transactions of an economy with the rest of the world. These transactions include exports and imports of goods, services and financial assets, along with transfer payments (like foreign aid).
Detailed explanation-3: -The formula for calculating the balance of payments is current account + capital account + financial account + balancing item = 0.
Detailed explanation-4: -The Balance of Payments is a record of transactions between individuals or entities of one country with the rest of the world, within an accounting year.
Detailed explanation-5: -There are three key BOP components, including the current account, capital account, and financial account. The current account must balance the capital and financial accounts.