The 'current account balance' is defined as:
A)exports minus imports.
B)the value of net exports + net primary income + net secondary income.
C)the amount of exported capital assets + net primary income.
D)the value of exports + imports + net primary income.

Question

Quizplus · Accepted Answer

The current account balance measures the total value of a country's transactions with the rest of the world in goods, services, primary income (such as wages and investment income), and secondary income (like foreign aid). Therefore, it is the sum of the net exports, net primary income, and net secondary income. Choice A only considers trade in goods, while Choice C only considers exported capital assets and primary income. Choice D includes the value of imports, which is not part of the current account balance.

The 'Current Account Balance' Is Defined As