Th4.1: Balance of Payments

Question 1

What are the components of the balance of payments?

Answer 1

the current account

capital and financial accounts

Question 2

What does the balance of payments show?

Answer 2

all flows into and out of the country and since total inflows must equal total outflows, the balance of payments must balance

Question 3

If there is a recorded deficit or surplus, this is a balancing item, all the transactions that fail to be recorded by the statisticians

Answer 3

we will figure out what this means