Based on the Balance of Payments account presented in this table, the balance of trade is:a. 2300b. -2600c. -300d. -200 Balance of Payments (Billions of Dollars)Total ExportsAGoods1500Services800Total ImportsВGoods-2100Services-500Balance of TradeCIncome receipts on investments800Income payments on investments-600Net transfers-100Current Account balanceChange in U.S. owned assets abroad-300Change in foreign owned assets in U.S.700Net financial derivatives-10Financial Account balanceEStatistical discrepancyF

Balance of trade = Net exports – Net imports = 1500 + 800 – 2100 – 500 = -300

Answered: Based on the Balance of Payments…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Based on the Balance of Payments account presented in this table, the balance of trade is:

a. 2300

b. -2600

c. -300

d. -200

Balance of Payments (Billions of Dollars)
Total Exports
A
Goods
1500
Services
800
Total Imports
В
Goods
-2100
Services
-500
Balance of Trade
C
Income receipts on investments
800
Income payments on investments
-600
Net transfers
-100
Current Account balance
Change in U.S. owned assets abroad
-300
Change in foreign owned assets in U.S.
700
Net financial derivatives
-10
Financial Account balance
E
Statistical discrepancy
F

Definition Definition Difference in value of a country's net exports and net imports for goods and services in a given period. A positive balance of trade is called a surplus and coincides with more net cash inflows into a country; a negative balance of trade deficit is a deficit and results in net cash outflows. A balance of trade surplus or deficit doesn't necessarily indicate a positive or negative situation for a country.

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