Purchases and sales of foreign assets by domestic residents would appear in the ________ account of the balance of payments.

Question

Quizplus · Accepted Answer

Purchases and sales of foreign assets by domestic residents fall under the capital account of the balance of payments, which records all transactions between domestic residents and non-residents involving the purchase or sale of non-financial assets (such as real estate) or financial assets (such as stocks or bonds) that are not used for the purpose of producing other goods and services. The current account (A) records transactions involving the exchange of goods and services, while the trade merchandise account (C) is a subcategory of the current account that measures the balance of trade in goods. The official settlement account (D) records transactions related to the central bank's reserves and payments made by countries to settle outstanding debts with each other.

Purchases and Sales of Foreign Assets by Domestic Residents Would