A U.S. purchase of patent rights from a firm in Mexico reflects a credit to the U.S. balance of payments account.

Question

Quizplus · Accepted Answer

The purchase of patent rights represents a capital transaction, not a current account transaction. Therefore, it does not affect the balance of payments, which only records transactions related to current account (like merchandise trade, services trade, income payments, and transfers) and capital and financial account (like direct investment, portfolio investment, and remittances).

A US Purchase of Patent Rights from a Firm in Mexico