In balance-of-payments accounting, the acquisition of a foreign production facility by a U.S. firm is a __________ item in the U.S. balance of payments; the deposit of funds in a Foreign bank account by a U.S. citizen __________ item in the U.S. balance of payments.
A) debit; also is a debit
B) debit; is a credit
C) credit; is a debit
D) credit; also is a credit

Question

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The acquisition of a foreign production facility by a U.S. firm represents a use of funds, or an outflow of capital from the U.S., which is recorded as a debit in the financial account of the U.S. balance of payments. Similarly, the deposit of funds in a foreign bank account by a U.S. citizen represents an outflow of capital from the U.S. and is also recorded as a debit in the financial account.

In Balance-Of-Payments Accounting, the Acquisition of a Foreign Production Facility