Regarding the statistical discrepancy in the balance-of-payments accounts
A)there is some evidence that financial transactions may be mainly responsible for the discrepancy.
B)the sum of the balance on the capital account and the statistical discrepancy is very close to the balance of the current account in magnitude.
C)it tends to be positive one year and negative in others, so it's safe to ignore it.
D)a and b

Question

Quizplus · Accepted Answer

Both options A and B are correct. Option A is supported by studies that show that financial transactions, such as capital flight and disguised capital inflows, can significantly affect the statistical discrepancy. Option B is a property of the balance of payments accounts, where the sum of the current account balance, capital account balance, and statistical discrepancy should be equal to zero in theory (but not always in practice). Therefore, option D is the best choice. Option C is incorrect because the statistical discrepancy, even if it fluctuates, is still an important component of the balance of payments accounts and should not be disregarded.

Regarding the Statistical Discrepancy in the Balance-Of-Payments Accounts