$$\begin{array} { | l | r | }
\hline \text { (1) Goods Exports } & + \$ 200 \
\hline \text { (2) Balance on Capital Account } & 0 \
\hline \text { (3) Net Transfers } & 0 \
\hline \text { (4) Imports of Services } & - 100 \
\hline \text { (5) Net Investment Income } & 0 \
\hline \text { (6) US Purchases of Assets Abroad } & - 50 \
\hline \text { (7) Goods Imports } & - 250 \
\hline \text { (8) Foreign Purchases of Assets in the US } & + 150 \
\hline \text { (9) Exports of Services } & + 50 \
\hline
\end{array}$$ The plus items in the table are "export-type" entries and the minus items are "import-type" entries in the balance of payments for the hypothetical country of Zippo. Zippo has

Question

$$\begin{array} { | l | r | } 
\hline \text { (1) Goods Exports } & + \$ 200 \
\hline \text { (2) Balance on Capital Account } & 0 \
\hline \text { (3) Net Transfers } & 0 \
\hline \text { (4) Imports of Services } & - 100 \
\hline \text { (5) Net Investment Income } & 0 \
\hline \text { (6) US Purchases of Assets Abroad } & - 50 \
\hline \text { (7) Goods Imports } & - 250 \
\hline \text { (8) Foreign Purchases of Assets in the US } & + 150 \
\hline \text { (9) Exports of Services } & + 50 \
\hline
\end{array}$$ The plus items in the table are "export-type" entries and the minus items are "import-type" entries in the balance of payments for the hypothetical country of Zippo. Zippo has

Quizplus · Accepted Answer

The balance of payments is balanced when the sum of the current account and the financial account equals zero. In this case, the current account (goods exports + services exports - goods imports - services imports) and the financial account (foreign purchases of assets in the US - US purchases of assets abroad) both sum to zero, indicating neither a deficit nor a surplus.

The Plus Items in the Table Are "Export-Type" Entries and