$$\begin{array} { | l | c | }
\hline \text { (1) Goods exports } & + \$ 220 \
\hline \text { (2) Goods imports } & - 328 \
\hline \text { (3) Exports of services } & + 54 \
\hline \text { (4) Imports of services } & - 55 \
\hline \text { (5) Net investment income } & + 18 \
\hline \text { (6) Net transfers } & - 11 \
\hline \text { (7) Capital account } & - 1 \
\hline \text { (8) Foreign purchases of Econland assets } & + 124 \
\hline \text { (9) Econland purchases of foreign assets } & - 21 \
\hline
\end{array}$$ The table contains balance of payments data for the hypothetical nation of Econland. All ?gures are in billions of dollars. Econland's balance on the current account shows a
A) de?cit of $91 billion.
B) de?cit of $102 billion.
C) de?cit of $109 billion.
D) surplus of $109 billion.

Question

$$\begin{array} { | l | c | } 
\hline \text { (1) Goods exports } & + \$ 220 \
\hline \text { (2) Goods imports } & - 328 \
\hline \text { (3) Exports of services } & + 54 \
\hline \text { (4) Imports of services } & - 55 \
\hline \text { (5) Net investment income } & + 18 \
\hline \text { (6) Net transfers } & - 11 \
\hline \text { (7) Capital account } & - 1 \
\hline \text { (8) Foreign purchases of Econland assets } & + 124 \
\hline \text { (9) Econland purchases of foreign assets } & - 21 \
\hline
\end{array}$$ The table contains balance of payments data for the hypothetical nation of Econland. All ?gures are in billions of dollars. Econland's balance on the current account shows a
A) de?cit of $91 billion.
B) de?cit of $102 billion.
C) de?cit of $109 billion.
D) surplus of $109 billion.

Quizplus · Accepted Answer

To calculate the current account balance, we add up goods exports, service exports, net investment income, and net transfers, then subtract goods imports, service imports, and unilateral transfers. Thus, the current account balance for Econland would be:

(1) + (3) + (5) + (6) - (2) - (4) - (7) = 
220 + 54 + 18 - 328 - 55 - 1 - 11 =
-103

This means that Econland has a current account deficit of $103 billion. Therefore, the correct answer is B, a deficit of $102 billion (since the other answer choices are a surplus or a larger deficit).

The Table Contains Balance of Payments Data for the Hypothetical