An American tourist purchases a leather jacket while in Italy. Which of the following statements is true?
A) The leather purchase would be considered an import for the U.S. BOP.
B) This transaction would be properly accounted for in the Current Account of the U.S. BOP.
C) The leather purchase is considered an import of a good, and thus, considered part of the balance of trade as well.
D) All of these statements are true.

Question

Quizplus · Accepted Answer

A) The leather purchase would be considered an import for the U.S. BOP because the American tourist is bringing a good from a foreign country into the United States.
B) This transaction would be properly accounted for in the Current Account of the U.S. BOP because it involves the exchange of goods between residents of different countries.
C) The leather purchase is considered an import of a good, and thus, considered part of the balance of trade as well. The balance of trade includes imports and exports of goods only. 
Therefore, all the statements are true.

An American Tourist Purchases a Leather Jacket While in Italy