Podcast
Questions and Answers
What does the balance of payments measure?
What does the balance of payments measure?
- The total amount of money in circulation within a country
- The unemployment rate in a country
- The government's budget surplus or deficit
- The economic transactions between residents of a country and the rest of the world (correct)
Which component of the balance of payments represents trade in goods and services?
Which component of the balance of payments represents trade in goods and services?
- Capital account
- Current account (correct)
- Official reserves account
- Financial account
What does a surplus in the capital account of the balance of payments indicate?
What does a surplus in the capital account of the balance of payments indicate?
- There is a decrease in the country's foreign exchange reserves
- More capital is flowing into the country than out of it (correct)
- The country is experiencing a budget surplus
- The country is importing more goods and services than it is exporting
Which of the following is not a method to calculate national income?
Which of the following is not a method to calculate national income?
In national income accounting, which of the following is not included in the calculation of national income?
In national income accounting, which of the following is not included in the calculation of national income?
Which of the following is a component of national income but not a component of gross domestic product (GDP)?
Which of the following is a component of national income but not a component of gross domestic product (GDP)?
Flashcards
Balance of Payments measures...
Balance of Payments measures...
Economic transactions between a country and the rest of the world.
Current Account represents...
Current Account represents...
Trade in goods and services.
Capital Account surplus indicates...
Capital Account surplus indicates...
More capital flowing into a country than out.
National Income calculation method is NOT...
National Income calculation method is NOT...
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National Income calculation excludes...
National Income calculation excludes...
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Component of national income, not GDP...
Component of national income, not GDP...
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Study Notes
Balance of Payments
- The balance of payments measures a country's international transactions, including exports and imports of goods and services, income, and financial claims.
Components of Balance of Payments
- The current account represents trade in goods and services.
Capital Account
- A surplus in the capital account indicates that the country is receiving more foreign investment than it is making abroad.
National Income Accounting
- The following methods are used to calculate national income: Income Approach, Expenditure Approach, and Value Added Approach.
- One method not used to calculate national income is the Balance of Payments Approach.
Gross Domestic Product (GDP)
- National income excludes transfer payments, such as social security benefits and welfare payments.
- One component of national income not included in GDP is net income from abroad.
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Description
Test your knowledge of balance of payments with this quiz designed for class 12th economics students. Explore questions about what the balance of payments measures, components representing trade in goods and services, and the significance of a surplus in the capital account. Sharpen your understanding of this fundamental economic concept.
