The real current account balance equals:

Question

Quizplus · Accepted Answer

The real current account balance represents the difference between real GNP (which includes both domestic and foreign income) and real domestic expenditure. Therefore, the correct answer is B. The trade balance is only one component of the current account balance and does not represent the full picture. The net international investment position represents the difference between a country's foreign assets and liabilities and is not directly related to the current account balance.

The Real Current Account Balance Equals