The components of the current account include imports of goods and services, exports of goods and services, and
A) net transfers.
B) any increase in U.S.-owned assets abroad.
C) military sales.
D) foreign-held money orders.

Question

Quizplus · Accepted Answer

The components of the current account are imports of goods and services, exports of goods and services, and net transfers. Net transfers refer to the flow of money between countries that is not related to the exchange of goods or services, such as foreign aid or remittances sent by foreign workers. Options B, C, and D are not part of the current account. Increases in U.S.-owned assets abroad would be recorded in the capital account, military sales would be recorded as exports of goods and services, and foreign-held money orders are not a component of the current account.

The Components of the Current Account Include Imports of Goods