When Americans build a factory in Costa Rica, the transactions associated with this factory are recorded in the ________ of the U.S. balance of payments.
A) current account
B) capital account
C) balance of trade
D) unilateral transfers
E) none, because it does not involve U.S. dollars

Question

Quizplus · Accepted Answer

When Americans invest in a factory in another country, such as Costa Rica, the investment is recorded in the capital account of the U.S. balance of payments. The capital account tracks the flow of investment funds across borders, including investments in physical assets like factories.

When Americans Build a Factory in Costa Rica, the Transactions