Question A summary of a country's economic transactions with foreign residents and governments is called the Answer a. current account balance. b. capital account balance. c. balance of trade. d. balance of payments.

Question A summary of a country's economic transactions with foreign residents and governments is called the Answer a. current account balance. b. capital account balance. c. balance of trade. d. balance of payments.

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter8: Investing Activities

Section: Chapter Questions

Problem 14QE

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Concept explainers

Balance of Payments

BOP is categorized into the following three components:

Question

A summary of a country's economic transactions with foreign residents and governments is called the

Answer

a. current account balance.

b. capital account balance.

c. balance of trade.

d. balance of payments.

Definition Definition Difference in value of a country's net exports and net imports for goods and services in a given period. A positive balance of trade is called a surplus and coincides with more net cash inflows into a country; a negative balance of trade deficit is a deficit and results in net cash outflows. A balance of trade surplus or deficit doesn't necessarily indicate a positive or negative situation for a country.

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