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Zorluk: OrtaBalance of Trade and Structure of Balance of Payments

An economy records 500millioninmerchandiseexports,500 million in merchandise exports, 650 million in merchandise imports, 120millioninnetinvisiblereceipts,andreceives120 million in net invisible receipts, and receives 200 million in foreign direct investment. What is the country's Current Account balance?

  1. A deficit of $30 millionCevap
  2. B
    A surplus of $170 million
  3. C
    A deficit of $150 million
  4. D
    A surplus of $270 million

Cevap

A deficit of $30 million
The Current Account measures the flow of goods, services, and primary/secondary income. Here, the visible balance is -150million(150 million ( 500M exports minus 650Mimports).Addingthenetinvisiblereceiptsof650M imports). Adding the net invisible receipts of 120 million gives a net current account balance of -30million,whichrepresentsadeficitof30 million, which represents a deficit of 30 million. Foreign direct investment ($200M) is an entry under the capital and financial account.

Adım Adım Çözüm

1
Calculate the Balance of Visible Trade
Merchandise Exports (500M)−MerchandiseImports(500M) - Merchandise Imports ( 650M) = -$150 million
Visible trade consists strictly of tangible goods exported and imported.
2
Calculate the Current Account Balance
Visible Trade Balance (-150M)+NetInvisibleReceipts(150M) + Net Invisible Receipts ( 120M) = -$30 million
The Current Account comprises both visible trade and invisible items (services, income, transfers).
3
Classify Foreign Direct Investment
Excluded from Current Account
Foreign direct investment is a capital flow and is recorded in the financial/capital account, not the current account.

Anahtar Kavram

Structure of the Balance of Payments and Current Account Components
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Konular

Balance of Trade and Structure of Balance of Payments

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