A U.S. citizen buys a newly issued share of stock in England, paying for his order with a check, which the British company deposits in its own U.S. bank account in New York. How is this transaction accounted for in the balance of payments?

Question

Quizplus · Accepted Answer

The transaction is recorded in the financial account as a U.S. asset import because the U.S. citizen is purchasing a foreign financial asset (the stock).

A US Citizen Buys a Newly Issued Share of Stock in in England