The Current Account

Question 1

what are transactions involved in the current account

Answer 1

transactions involving trade in goods and services and income flows between Aus and overseas residents

Question 2

what are the 3 components of the current account

Answer 2

trade in goods, services and income

Question 3

trade in goods:
- export in goods (examples)
- import in goods (examples)
what was the goods balance in 2020

Answer 3

exports in goods: raw materials
Import in goods: manufactured materials
$19 billion June 2020

Question 4

trade in services:
- export in services(examples)
- import in services(examples)
what was the services balance in 2020

Answer 4

exprots in services: education, financial, ICT
imports in services: travel, transport (freight)
$5.7 billion surplys 2020 - usually deficit

Question 5

trade in income: primary
what was the income balance 2020
what are the 2 parts of the primary income balance

Answer 5

$5.4 billions defiicit 2020

1. compensation of employees (for labour use)
   - wages/salaries to workers
2. Investment Income (for use of capital)

Question 6

trade in income: primary
What are the 2 forms of investment income
what are examples of credits and debts

Answer 6

equity investment (dividend payments)
interest income (associated with loans)
CREDITS: aus residents recieve income from foreign investors
DEBITS: income payments made to foreign investors

Question 7

trade in income: secondary
what is secondary income
what are examples of credits and debits

Answer 7

when real/financial resources a provided but nothing of economic value is returned
debit - foreign aid/donations made by AUs
credit - gifts recieved by Aus from foreign

Question 8

how do calculate the current acount balance

Answer 8

balance on g + s + net income

Question 9

what was the 2020 CA balance

Answer 9

$19.2 billion surplus