A nation's current account balance is equal to its exports less its imports of
A) goods and services.
B) goods and services, minus U.S. purchases of assets abroad.
C) goods and services, plus net investment income and net transfers.
D) goods and services, plus foreign purchases of assets in the United States.

Question

Quizplus · Accepted Answer

The current account balance is a measure of a nation's total transactions with other countries. It includes the balance of trade (exports - imports) of goods and services, as well as net investment income and net transfers. Therefore, choice C is the best answer as it includes all three components of the current account balance.

A Nation's Current Account Balance Is Equal to Its Exports