Balance of payments (OCR A-Level Economics): Flashcards
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Balance of Payments definition
Balance of Payments definition
Set of accounts showing transactions between country & rest of world
Current Account definition
Current Account definition
Transactions in goods, services, income & transfers with rest of world
Financial Account definition
Financial Account definition
Transactions in financial assets between country & rest of world
Capital Account definition
Capital Account definition
Transactions in physical assets between country & rest of world
Current Account Surplus definition
Current Account Surplus definition
Inflows of money > outflows for net exports, income & transfers
Current Account Deficit definition
Current Account Deficit definition
Outflows of money > inflows for net exports
What is visible trade?
What is visible trade?
Trade in goods
What is invisible trade?
What is invisible trade?
Trade in services
Four components of current account
Four components of current account
Trade in goods, services, primary income, secondary income
What does primary income include?
What does primary income include?
Dividends, interest, and profits from investments
Alternative name for secondary income
Alternative name for secondary income
Current transfers
Strong currency effect on exports
Strong currency effect on exports
Makes exports more expensive
Strong currency effect on imports
Strong currency effect on imports
Makes imports cheaper
Consequence of persistent current account deficits
Consequence of persistent current account deficits
Increasing foreign debt
What should BoP sum to?
What should BoP sum to?
Zero