Suppose that a German trades a mug of beer for a glass of wine from a Frenchman. For France, this counts as a:

Question

Quizplus · Accepted Answer

This transaction involves the exchange of goods (beer and wine) between two individuals from different countries. Therefore, it is recorded as an export (wine) and an import (beer) on the current account. As the Frenchman is exporting goods, this counts as a current account credit for France. On the other hand, as the German is importing goods, this counts as a current account debit for Germany. The other options (B, C, and D) do not accurately reflect the nature of this transaction.

Suppose That a German Trades a Mug of Beer for a Glass