The balance-of-payments identity is an equation that shows that the value of:
A) net exports equals the net capital outflow.
B) net capital inflow equals the net capital outflow.
C) imports must equal exports.
D) payments from a country exceeds payments to a country.

Question

Quizplus · Accepted Answer

The balance-of-payments identity is expressed as NX = NCO, where NX represents net exports and NCO represents net capital outflow. Therefore, A is the correct choice as it directly states this relationship.

The Balance-Of-Payments Identity Is an Equation That Shows That the Value