ECONOMICS
BALANCE OF PAYMENTS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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It is always negative.
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It is always equal to the financial account.
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It is always positive.
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It is always equal to zero.
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It is not always balanced.
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Detailed explanation-1: -Answer and Explanation: The correct answer is : C. US Capital inflow and outflow.
Detailed explanation-2: -Statement 3 is correct: The Balance of Payments (BoP) includes both the current account and capital account, in the capital account there is the nation’s imports and exports of capital and foreign aid.
Detailed explanation-3: -Answer and Explanation: The answer is c). The two accounts in the balance of payment system are the current account and capital account.
Detailed explanation-4: -Measuring the current account The current account balance is then the trade balance plus net factor income (such as interest and dividends from foreign investments or workers’ remittances) and transfers from abroad (such as foreign aid), which are usually a small fraction of the total.