International Financial Management 2nd Edition by Geert Bekaert ,Robert Hodrick

Exercise 19

What are the effects on the British balance of payments of the following set of transactions U.K. Videos imports £24 million of movies from the U.S. firm Twenty-First Century Wolf (TFCW). The payment is denominated in pounds, is drawn on a British bank, and is deposited in the London branch of a U.S. bank by TFCW because TFCW anticipates purchasing a film studio in the United Kingdom in the near future.