The balance of payments is:
A) the difference between the dollar value of exports and the dollar value of imports.
B) the same as the merchandise account.
C) a summary statement of all international trade transactions of one country with the rest of the world.
D) a summary statement of all domestic exchanges of goods and services between producers and buyers.
E) a record of the amount of U.S. dollars held abroad.

Question

Quizplus · Accepted Answer

The balance of payments is a summary statement of all international trade transactions of one country with the rest of the world. It includes payments for imports and exports of goods and services, as well as investment income and transfers between countries. A and E are incorrect because they do not encompass all international transactions. B and D are incorrect because they do not include financial transactions or transfers.

The Balance of Payments Is