When a U.S.firm imports a good from England a pays for it by drawing on its pound sterling balances in a London Bank,the U.S.debits its current account and credits its:

Question

Quizplus · Accepted Answer

The U.S. credits its financial account because the transaction involves a change in financial assets, specifically the use of pound sterling balances in a London bank to pay for the import.

When a USFirm Imports a Good from England a Pays for It