Podcast
Questions and Answers
What does the balance of payment contain a classified record of?
What does the balance of payment contain a classified record of?
- Receipts and payments arising from goods exported, services rendered, and capital received (correct)
- Only payments arising from services rendered
- Only receipts arising from goods exported
- Only capital received by residents in a country
What does the balance of payment not include?
What does the balance of payment not include?
- Receipts arising from goods exported
- Services rendered by non residents (correct)
- Capital transferred to non residents
- Payments made by residents on account of goods imported
What does the balance of payment record for a country?
What does the balance of payment record for a country?
- Only goods exported and imported
- Only capital received by residents in a country
- All economic transactions between residents of the country and residents of foreign countries (correct)
- Only services rendered by residents in a country
What is the period for which the balance of payments is usually prepared?
What is the period for which the balance of payments is usually prepared?
How are economic transactions recorded in the balance of payments?
How are economic transactions recorded in the balance of payments?
What does a favorable or surplus position in the balance of payments indicate?
What does a favorable or surplus position in the balance of payments indicate?
What does the balance of payments show about a country's position in foreign trade?
What does the balance of payments show about a country's position in foreign trade?
What does the balance of payments include?
What does the balance of payments include?
Study Notes
Balance of Payments
- Classified record of a country's international transactions with the rest of the world
- Records all transactions between a country's residents and non-residents
Exclusions
- Does not include transactions between residents
Country's Record
- Records credits and debits of a country's international transactions
- Includes transactions related to goods, services, income, and financial claims
Period
- Usually prepared for a year or a quarter
Transaction Recording
- Economic transactions recorded in the balance of payments using double-entry bookkeeping
- Debits represent outflows ofgoods, services, and income
- Credits represent inflows of goods, services, and income
Favorable Position
- A surplus or favorable position indicates that a country's exports exceed its imports
- Indicates a country's foreign exchange earnings are higher than its foreign exchange payments
Country's Position in Foreign Trade
- Shows a country's performance in foreign trade, including its competitiveness and trade balance
- Reveals whether a country is a creditor or debtor nation
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Test your knowledge of international economics with this quiz on balance of payments. Challenge yourself with questions about economic transactions between residents of different countries, receipts and payments for goods and services, and capital received and paid.
