A country has a current account surplus if
A)the value of its exports exceeds the value of its imports, assuming net income from foreign assets and net unilateral transfers have a value of zero.
B)the value of its net exports of services exceeds the value of its net exports of goods.
C)it receives more income from foreign assets than it pays to foreigners for foreign-owned domestic assets.
D)its capital inflows exceed its capital outflows.

Question

Quizplus · Accepted Answer

A current account surplus occurs when a country's exports exceed its imports, after taking into account net income from foreign assets and net unilateral transfers. This means that the country is earning more foreign currency than it is spending, resulting in a surplus on its current account. B is incorrect because the current account balance includes both goods and services, not just one or the other. C refers to the income and capital account, not the current account. D refers to the overall balance of payments, not the current account specifically.

A Country Has a Current Account Surplus If