Debt (-) items in the balance of payments correspond to anything that:
A) Involves receipts from foreigners
B) Involves payments to foreigners
C) Increases the domestic money supply
D) Decreases the demand for foreign exchange

Question

Quizplus · Accepted Answer

Debt (-) items in the balance of payments represent payments made to foreigners, such as payments for imports, payments of interest on loans obtained from foreign creditors, and principal repayments on foreign loans. These transactions decrease the country's net international investment position and hence are recorded as negative items in the balance of payments.

Debt (-) Items in the Balance of Payments Correspond to Anything