The current account balance consists of
A)the trade balance plus the services balance.
B)net exports of goods and services,minus net unilateral transfers.
C)net exports of goods and services,plus investment income from abroad,plus net unilateral transfers.
D)net exports of goods and services,plus investment income from abroad,plus net unilateral transfers,minus the capital and financial account balance.

Question

Quizplus · Accepted Answer

The current account balance measures a country's total exports and imports of goods and services, as well as other transfers such as investment income and unilateral transfers (gifts or aid received or given). Therefore, the correct option is C, which includes all three components mentioned. Option A includes only the trade and services balance, while option B omits the investment income and unilateral transfers. Option D subtracts the capital and financial account balance, which is not part of the current account balance.

The Current Account Balance Consists of