If a U.S. citizen gives $1,000 to a French citizen by writing a check on a New York bank for deposit to the French citizen's New York bank account, the credit item in the U.S. balance-of-payments accounts is __________ and the debit item is __________.

Question

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The credit item in the U.S. balance-of-payments accounts would be an "increase in foreign short-term private assets in the United States" because the French citizen is depositing money into their New York bank account. The debit item would be "unilateral transfers made" because the U.S. citizen is giving money to the French citizen without receiving anything in return, which is considered a unilateral transfer.

If a US Citizen Gives $1,000 to a French Citizen by Writing