ECONOMICS (CBSE/UGC NET)

ECONOMICS

BALANCE OF PAYMENTS

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

Each month, Ima Grent, who recently arrived in the United States, sends half her paycheck to her sister in Poland. How is this recorded in the US BOP?

A	credit
B	debit
C	Either A or B
D	None of the above

Explanation:

Detailed explanation-1: -When the foreign exchange is being sold by the reserve bank when there is a deficit, it is known as official reserve sale. The decrease or increase in official reserves is known as the overall balance of payments deficit or surplus.

Detailed explanation-2: -What Is the Formula for Balance of Payments? The formula for calculating the balance of payments is current account + capital account + financial account + balancing item = 0.

Detailed explanation-3: -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-4: -Current account. Financial account. Capital account. Decision-making. Developing trade policies. Establishing fiscal objectives. Implementing growth strategies. Analyzing deficits.

There is 1 question to complete.