If a Canadian company imports 10 Toyotas from Japan at $15,000 each,and the Japanese company buys airline tickets on a Canadian airline with the money,how does this affect the Canadian balance of payments accounts?
A)debit: merchandise trade;credit: capital account
B)debit: capital account;credit: merchandise trade
C)debit: merchandise trade;credit: services
D)debit: services;credit: merchandise trade

Question

Quizplus · Accepted Answer

The import of Toyotas results in a debit to the merchandise trade account, while the purchase of airline tickets by the Japanese company results in a credit to the services account.

If a Canadian Company Imports 10 Toyotas from Japan at $15,000