Which of the following would be entered as a credit in the financial account of the United States?
A) Purchase of U.S. Treasury bonds by Americans
B) Purchase of U.S. Treasury bonds by foreigners
C) Purchase of U.S. made cars by foreigners
D) Income earned by the U.S. from tourism
E) Purchase of foreign stocks by U.S. investors

Question

Quizplus · Accepted Answer

The purchase of U.S. Treasury bonds by foreigners would be entered as a credit in the financial account of the United States because it represents an inflow of capital from foreigners to the U.S. This is because when foreigners buy U.S. Treasury bonds, they are effectively lending money to the U.S. government, resulting in an inflow of funds into the United States.

Which of the Following Would Be Entered as a Credit