After a hurricane devastates New Orleans, a Canadian charity sends $1 million to the United States to help the survivors rebuild their homes. In the U.S. balance of payments, this transaction causes the balance on the _____ account to _____.

Question

Quizplus · Accepted Answer

This transaction is recorded in the current account as a transfer payment, which increases the current account balance because it represents an inflow of funds to the United States without a corresponding outflow.

After a Hurricane Devastates New Orleans, a Canadian Charity Sends